UC-NRLF 


^B    E7T    ^2b 


TPiE  Art  of 


Investinc 


LIBRARY 

OF    THE 

UNIVERSITY  OF  CALIFORNIA. 
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http://www.archive.org/details/artofinvestingOOhumerich 


THE 


ART  OF  INVESTING 


BY 


A  NEW  YORK    BROKER 


}■ 


OF  / 

NEW   YORK 
APPLETON    AND    COMPANY 

1888 


/}/  6  6 


Copyright,  1888, 
By  D.  APPLETON  AND  COMPANY. 


PEEFACE. 


The  appearance,  over  his  signature, 
in  leading  magazines,  of  the  papers  that 
principally  make  np  the  following  hro- 
cjiure,  has  involved  the  writer  in  con- 
siderable correspondence.  A  number  of 
parties  have,  in  consequence,  written  to 
him :  some  requesting  a  fuller  statement 
of  his  views  on  points  partially  dis- 
cussed or  merely  touched  upon;  some 
disputing  his  conclusions  or  having  sug- 
gestions of  their  own  to  offer ;  and  others, 
who  had  been  made  aware  of  the  exist- 
ence of  the  publications  through  news- 


PREFACE, 


paper  notices  or  in  some  other  way,  and 
not  caring  to  be  at  tlie  trouble  and  cost 
of  procuring  tlie  periodicals  in  wliicli 
they  were  to  be  found,  asking  for  a  re- 
production of  such  passages  as  might  be 
applicable  to  their  special  circumstances. 
The  interest,  as  evidenced  by  the  corre- 
spondence referred  to,  which  the  papers 
as  magazine  articles  have  awakened, 
seems  to  the  writer  to  be  ample  apology 
for  their  reappearance  in  more  accessi- 
ble and  economical  form  if  the  dis- 
cussion of  a  subject  of  such  general  con- 
cern as  the  investment  of  money,  with 
a  view  to  an  income  more  or  less  fixed 
and  permanent,  calls  for  apology. 

Somewhat  in  the  nature  of  a  sup- 
plement, has  been  added  a  chapter  on 
speculation.     People  having  idle  money 


PREFACE. 


often  find  it  difficult  to  decide  whether 
they  had  better  invest  it  securely,  con- 
tent with  the  amount  they  have  and  the 
revenue  to  be  derived  as  interest,  or 
seek  to  add  to  the  principal  by  ventures 
necessarily  more  or  less  uncertain.  The 
temptations  to  the  latter  course  that  are 
held  out  by  our  stock  and  other  ex- 
changes are  very  dazzling — sometimes 
quite  irresistible.  It  is  to  those  institu- 
tions that  persons  of  a  speculative  turn 
and  with  money  in  hand  are  apt  to  look 
for  the  realization  of  their  hopes.  To 
any  who  may  be  halting  between  the 
policies  spoken  of,  with  an  inclination 
to  do  a  little  in  stocks,  the  subjoined 
criticism  of  the  methods  and  bearings 
of  our  leading  exchanges  that  make  a 
business  of  shares  and  bonds  may  prove 


PREFACE. 


to  be  both  entertaining  and  instructive 
reading. 

A  few  alterations  have  been  made 
in  the  original  text,  and  some  additions 
to  cover  points  raised  or  suggested  by 
communications  from  friendly  hands; 
otherwise,  the  matter  is  unchanged. 

As  the  author  prefers  to  avoid  the 
suspicion  of  using  this  publication  as  an 
advertisement  of  his  business — that  of  a 
broker  in  securities — the  matter  which 
in  another  form  appeared  over  his  signa- 
ture is  now  presented  without  that  ap- 
pendage. 


OOS"TEI^TS. 


CHAPTER  I. 

PAGE 

Investing ^ 

goveenments ^^ 

State  Obligations ^^ 

Municipal  Obligations         .        .        .        '56 

Raileoad  Moetgages 65 

Railboad  Stocks *^^ 

Othee  Stocks *^ 

Faem  Moetgages  • '  ^ 

Ranch  Secfeities ^2 

Watee-Woeks  Loans 96 

Steeet-Railwat  Bonds         .        •        •        .107 

Miscellaneous  Bonds 109 

Mining  Secueities HI 

Beidge  Bonds H^ 

Substitution  Secueities       ....  115 


CONTENTS. 


CHAPTER  II. 
Speoxjlating 

PAGB 

.  118 

APPENDIX. 

Investment  Seoueities 

.  155 

New  York  Stocz-Exohange 

.  157 

Philadelphia  Stock-Exchange    . 

.  185 

Boston  Stock-Exchange 

.  190 

Baltimore  Stock-Exchange 

.  196 

THE  ART  OF  INVESTING. 


CHAPTEE  L 
INVESTING.'' 

"How  can  I  invest  my  money  to 
make  it  pay  a  fair  interest,  and  at  tlie 
same  time  insure  its  safety  ? "  is  a  ques- 
tion daily  asked  by  thousands.  With 
the  multiplication,  consequent  upon  the 
growth  of  wealth  among  us,  of  that  class 
of  persons  who  want  to  live  by  their 
means,  without  care  or  labor,  the  num- 
ber of  anxious  inquirers  on  that  point  is 

*  The  greater  part  of  this  chapter  appeared  in 
"  The  Popular  Science  Monthly  "  under  the  title  of 
"  The  Art  of  Investing." 


THE  ART  OF  INVESTING. 


constantly  increasing.  It  would  seem, 
when  reference  is  liad  to  the  many  secu- 
rities, both  bonds  and  shares,  that  are 
offered,  often  at  temptingly  low  prices, 
to  be  a  question  very  easily  answered. 
The  truth  is,  that  there  is  none  more 
difficult.  The  ordinary  investor  who 
goes  about  the  work  of  converting  his 
cash  into  paper  combining  the  two  ele- 
ments of  value  spoken  of,  finding  himself 
hopelessly  embarrassed  by  the  seeming 
richness  of  the  market,  soon  gives  up  in 
despair,  and  turns  the  job  over  to  some 
banker  or  broker  who  works  for  a  com- 
mission. Experience  shows  that  even 
then  he  is  too  often  the  victim  of  defect- 
ive judgment  or  misplaced  confidence. 
If  it  is  difficult  to  make  money — a 
proposition  about  which  there  will  not  be 


INVESTING.  n 


mucli  diversity  of  opinion — it  is  in  most 
cases  even  more  difficult  to  keep  it  prof- 
itably employed.  Men  of  prudence  and 
skill  in  tlie  acquisition  of  capital  often 
sliow  astonishing  recklessness  in  tke  dis- 
position they  make  of  it.  The  strangest 
caprices  take  possession  of  them  when  it 
comes  to  the  critical  moment  that  calls 
for  a  choice  of  investments.  And  as 
riches  are  always  clothed  with  folded 
wings  ready  to  expand  at  the  most  un- 
looked-for exigencies,  it  is  not  much 
wonder  that  they  frequently  take  to  the 
winds  and  pass  beyond  recall. 

The  history  of  investment  securities 
would  furnish  a  most  interesting  study. 
In  no  other  department  of  business  have 
there  been  greater  changes.  The  time 
has  been,  within  the  memoiy  of  many 


12  THE  ART  OF  INVESTING, 

now  living,  wlien  tlie  man  wlio  liad 
money  to  put  at  usury  generally  loaned 
on  personal  indorsement,  the  borrower 
relying  on  his  neighbor  or  other  good 
friend  to  "back"  his  paper  for  him. 
The  mortgage  on  real  estate,  of  course, 
was  known ;  but,  owing  to  the  short  in- 
tervals for  which  loans  were  generally 
made,  was  not  often  resorted  to.  The 
shares  of  banking,  turnpike,  canal,  rail- 
way, and  other  incorporated  companies 
after  a  while  began  to  absorb  the  money 
of  people  who  wanted  to  realize  more 
than  current  rates  of  interest,  and  were 
vrilling  to  take  corresponding  risks. 

Nor  have  we  yet  reached  a  finality  in 
the  matter  of  investments.  Changes  and 
innovations  are  of  continual  occurrence. 
Not  only  are  new  secuiities  coming  upon 


INVESTING.  13 


the  market,  but  new  subjects  as  a  basis 
for  their  production  are  industriously 
sought  after,  and  new  forms  for  their 
preparation  are  being  invented.  Such 
things  as  commercial  farm  mortgages, 
water-works  loans,  street-railway  debent- 
ures, etc.,  etc.,  were  utterly  unknown  but 
a  short  time  ago.  Progress  in  the  manu- 
facture of  investment  issues  keeps  pace 
with  all  material  developments.  Every 
newly-discovered  force  or  process  in  me- 
chanics means  the  appearance  of  another 
detachment  of  paper  securities. 

The  war  of  the  rebellion  popularized 
the  coupon  bond,  in  consequence  of  its 
adoption  by  the  Government,  and  made 
it  the  favorite  form  of  investment  paper. 
Railroad  and  other  corporations  lost  no 
time  in  availing  themselves  of  the  confl- 


14  THE  ART  OF  INVESTING. 

dence  wMcli  tliat  species  of  debenture 
inspired,  and  States,  cities,  counties,  etc., 
were  soon  flooding  tlie  country  witli  ob- 
ligations carrying  long  coupon  attacli- 
ments.  Except  for  Government  and 
municipal  uses,  there  never  was  a  more 
disastrous  invention.  It  lias  been  tlie 
means  of  numberless  deceptions,  and  lias 
inflicted  heavier  losses  upon  tlie  invest- 
ing public  tlian  all  otlier  devices  com- 
bined. Being  supplemental  to  stock 
certificates,  it  lias  duplicated  representa- 
tives of  tbe  same  values  and  led  to  ex- 
cessive issues  of  paper;  it  lias  separat- 
ed capitalists  from  tlie  management  of 
properties  into  whicli  tlieir  moneys  have 
gone ;  and,  being  based  upon  mortgages 
promising  absolute  security,  it  has  too 
often  accomplished  the  grossest  decep- 


INVESTING.  15 


tion.  Many  a  man  lias  purcliased  and 
paid  a  good  price  for  a  mortgage  coupon 
bond,  giving  him  no  control  over  his 
security,  who  would  have  rejected  a 
share-certificate  standing  for  an  equal 
interest  in  the  property  pledged,  and 
giving  him  the  right  to  participate  in  its 
management,  with  the  possibility  of  a 
greater  return  for  his  money. 

Under  the  careless  legislation  of 
many  of  the  States,  which  has  permit- 
ted corporations  to  decide  for  them- 
selves the  amounts  of  obligations  they 
might  put  out,  it  is  no  wonder  that  the 
privilege  has  been  abused,  and  the  mak- 
ing of  shares  and  bonds,  the  latter  rep- 
resented to  be  amply  secured  by  mort- 
gage liens,  has  been  carried  to  criminal 
excess.      One    illustration  will    suffice: 


i6  THE  ART  OF  INVESTING. 

The  Arkansas  Central  Railway  Com- 
pany (the  name  indicates  the  locality) 
built  only  forty-eight  miles  of  its  pro- 
jected road.  The  road  was  of  narrow 
gauge,  with  very  light  iron,  and  in  every 
way  cheaply  constructed.  It  cost  less 
than  ten  thousand  dollars  per  mile,  in- 
cluding equipment.  As  has  been  the 
case  with  most  of  companies  building 
railways  in  new  countries,  help  in  its 
behalf  was  asked  from  the  communities 
to  be  benefited,  and  their  bonds  amount- 
ing to  nearly  half  a  million  dollars  were 
given  it  by  counties,  cities,  etc.  Un- 
der a  statute  providing  for  aid  to  rail- 
roads when  their  beds  could  be  utilized 
for  levee  purposes,  the  company  got 
$160,000  of  State  bonds.  Under  an- 
other statute  it  got,  as  a  loan  from  the 


INVESTING.  17 


State,  its  bonds  to  the  amount  of  $1,- 
350,000,  wMcli  were  to  be  a  first  lien 
upon  tlie  property.  After  such  abun- 
dant assistance,  it  would  have  appeared 
hardly  necessary  for  the  company  to  put 
out  obligations  of  its  own.  However,  it 
proceeded  to  issue  and  market  its  owtl 
debentures  to  the  amount  of  $2,500,000, 
of  which  $1,200,000  purported  to  be  se- 
cured by  first  mortgage,  a  representa- 
tion that,  for  reasons  already  stated,  was 
not  correct.  In  addition,  a  considerable 
amount  of  stock  certificates  was  issued. 
Altogether,  nearly  $5,000,000  of  paper 
was  put  out  and  negotiated  on  the  basis 
of  forty -eight  miles  of  narrow-gauge 
road.  But  this  proved  to  be  insufficient. 
The  road,  for  non-payment  of  interest  on 
its  bonds,  soon  passed  into  the  hands  of 


i8  THE  ART  OF  INVESTING, 

a  receiver,  wlio  found  it  in  such  an  un- 
finislied  state  that,  with  the  court's  per- 
mission, he  issued  a  considerable  amount 
of  his  own  certificates  to  provide  for  ne- 
cessary repairs  and  betterments.  Then 
the  road— the  product  of  so  much  out- 
lay—  was  sold  at  public  auction,  and 
brought  the  magnificent  sum  of  $40,000, 
which  was  paid,  not  in  cash,  but  in  re- 
ceiver's certificates  that  had  been  pur- 
chased at  a  great  discount  from  their 
face  ! 

The  business  of  manufactuiing  secu^ 
rities  has  not  been  confined  to  railroad 
builders.  We  now  have  stocks  and 
bonds  upon  the  market  representing 
nearly  all  conceivable  kinds  of  prop- 
erty— telegraphs,  telephones,  mines,  cat- 
tle ranches,  grain  and  grass  farms,  water- 


INVESTING.  19 


works,  bridges,  oil  and  gas  wells,  elec- 
tric lights,  factories  and  mills  of  every 
description,  patent  rights  of  all  sorts, 
steamboat  lines,  apartment  houses,  and, 
in  one  instance,  a  cemetery  !  And  not 
only  are  properties  of  many  kinds  used 
to  issue  bonds  upon,  but  many  kinds  of 
bonds  are  often  issued  upon  the  same 
properties.  Thus  we  find  among  our 
railroads  not  only  first,  second,  and  third 
mortgages,  but  income  bonds,  converti- 
ble bonds,  consolidated  bonds,  redemp- 
tion bonds,  renewal  bonds,  terminal 
bonds,  divisional  bonds,  sinking-fund 
bonds,  "  blanket  -  mortgage  *'  bonds,  col- 
lateral trust  bonds,  equipment  bonds, 
and  bonds  ad  nmtseam,  until  they  lap 
and  overlap  in  seemingly  endless  compli- 
cation.    Not  that  merely,  but  one  issue 


20  THE  ART  OF  INVESTING. 

of  bonds  is  sometimes  made  tlie  basis  for 
other  issues.  Indeed,  one  of  tlie  money- 
making  devices  of  the  time  is  the  forma- 
tion of  companies  that  issue  their  bonds 
on  the  security  of  other  people's  bonds 
that  they  have  purchased,  either  yield- 
ing a  higher  rate  of  interest  or  obtained 
at  lower  prices  than  they  expect  to  re- 
alize for  their  issues.  There  seems,  in 
fact,  to  be  no  limit  to  the  production  of 
securities  that  are  spread  before  capital- 
ists. There  never  was  a  time  when  it 
was  so  easy  to  invest  money  —  and  to 
lose  it.  Of  the  securities  that  are  offered 
with  first-class  recommendations,  it  is 
probable  that  about  one  third  are  actu- 
ally good,  one  third  have  some  value, 
and  one  third  are  practically  worthless. 
Hence  the  very  natural  inference  that 


INVESTING.  21 


whatever  art  there  may  be  in  the  mat- 
ter of  investing  is  to  be  exercised  chiefly 
in  the  avoidance  of  unworthy  offerings, 
and  it  is  to  that  point  that  a  profitable 
discussion  of  the  subject  must  be  mainly 
directed. 

For  the  condition  of  things  de- 
scribed, the  laws  of  some  of  our  States 
in  giving  corporations  almost  limitless 
power  to  issue  negotiable  paper,  as  well 
as  in  permitting  all  sorts  of  companies 
to  incorporate  themselves,  are,  undoubt- 
edly, very  largely  to  blame.  Our  banks 
are  closely  watched  and  very  properly 
restrained  from  taking  people's  money 
on  false  pretenses;  but  how  much  bet- 
ter is  it  for  railway  and  other  corpora- 
tions to  take  it  by  means  of  legalized 
fictitious    evidences    of    value  ?     Banks 


22  THE  ART  OF  INVESTING. 

are  by  no  means  tlie  only  corporate  in- 
stitutions that  need  watching.  One  of 
tlie  reforms  that  would  seem  to  be  very 
much  demanded  is  legislation  prohibi- 
tory of  the  creation  by  companies  ex- 
isting by  authority  of  law,  of  debent- 
ures or  scrip  not  representing  moneys 
actually  paid  into  their  treasuries,  or 
proprietary  interests  whose  values  are 
to  be  determined  by  disinterested  par- 
ties. Pennsylvania  has  incorporated  sub- 
stantially such  a  provision  in  her  con- 
stitution. Her  example  should  be  fol- 
lowed by  all  other  commonwealths.  But 
as  long  as  corporations  are  permitted, 
almost  without  limitation,  to  flood  the 
country  with  seductive  promises  of  mon- 
ey payments  and  to  have  them  offered 
in  all  our   financial   marts,  it  behooves 


INVESTING.  23 


investors  to  be  correspondingly  cautions 
in  making  tlieir  purchases.  If  the  law 
will  not  protect  them,  they  should  be 
the  more  careful  to  protect  themselves. 
But  the  security  behind  or  beneath 
the  debenture  or  other  paper  obligatoiy 
is  not  the  only  thing  to  be  looked  into 
by  the  investor.  Even  the  form  of  the 
document  may  be  important.  A  case 
in  point,  inasmuch  as  it  shows  how  the 
preparation  of  an  undertaking  for  the 
payment  of  money  may  change  its  ap- 
parent value,  would  seem  in  this  con- 
nection to  be  appropriately  quoted. 
Some  years  ago  certain  townships  in  the 
State  of  Missouri  were  desirous  of  aid- 
ing the  construction  of  railroads  with 
their  credit.  The  State  legislature,  to 
that  end,  passed  an  act  authorizing  the 


24  THE  ART  OF  INVESTING. 

issue  and  sale  of  bonds  obligatory  upon 
them;  but  it  was  stipulated — a  very 
singular  provision — that,  instead  of  be- 
ing put  out  by  the  townships,  the  bonds 
should  be  executed  by  the  officials  of 
the  counties  in  which  they  were  located. 
Accordingly,  debentures  aggregating  sev- 
eral million  dollars  were  thus  prepared 
and  disposed  of.  The  bonds  bore  the 
seals  of  the  counties  and  the  signatures 
of  their  officials.  On  the  back  and  at 
the  top  of  each  obligation  in  large  let- 
ters were  the  words  "county  bond." 
The  instrument  began  with  the  recital, 
in  the  usual  form,  that  it  was  issued  by 
the  county ;  but  farther  on,  and  in  the 
smallest  type  employed,  came  the  state- 
ment that  it  was  executed  for  and  in  be- 
half of  a  certain  township,  which  alone 


INVESTING.  25 


was  to  be  responsible  for  its  payment. 
These  bonds  were  extensively  advertised 
as  "county  bonds,"  and  probably  in 
most  instances,  certainly  in  many,  were 
sold  as  sucli,  and  it  was  not  until  pur- 
chasers liad  parted  witli  their  money 
that  they  discovered  that,  instead  of 
getting  the  paper  of  well  known  and 
wealthy  counties,  they  had  secured  only 
the  obligations  of  townships  they  had 
never  heard  of  before.  It  was  then 
manifest  enough  that  they  had  been 
made  the  victims  of  a  piece  of  very 
sharp  and  very  shabby  practice.  In 
very  many  cases  the  buyers  of  bonds 
and  other  securities  learn,  when  it  is 
too  late,  that  their  purchases,  owing  to 
some   obscure  and  apparently  innocent 

passage   that   had   been    overlooked   or 
3 


26  THE  ART  OF  INVESTING. 

disregarded,  are  very  different  from 
what  they  thouglit  tliey  were  getting. 
How  often  have  careless  investors  tliat 
supposed  tliey  were  purchasing  under- 
takings that  would  be  good  for  long 
terms  of  years,  and  probably  paid  pre- 
miums to  obtain  them,  ascertained  at 
the  end  of  comparatively  short  intervals 
that  they  were  forced  to  accept  in  pay- 
ment the  amounts  nominated  in  the 
bonds  in  consequence  of  unnoticed 
clauses  giving  their  makers  power  to 
redeem  at  their  option?  The  lesson  of 
such  cases  is  obvious  enough.  It  is  that 
no  one  should  ever  buy  a  moneyed  un- 
dertaking without  having  first  carefully 
read  it.  This  may  seem  like  an  un- 
necessary warning;  but  in  truth  it  is 
a  most  material   one.     Thousands  and 


INVESTING.  27 


thousands  of  dollars  have  been  lost  by 
the  neglect  of  tliis  simple  precaution. 
"I  didn't  read  the  paper"  is  the  ex- 
planation that  has  again  and  again  been 
offered  when  time  has  disclosed  a  dif- 
ferent investment  from  the  one  intended 
to  be  paid  for.  The  fact  is  that  com- 
paratively few  unprofessional  bond  and 
share  purchasers  ever  carefully  examine 
the  instruments  they  acquire.  They 
look  at  the  headings,  those  parts  that 
are  in  big  letters,  and  take  the  rest  for 
granted.  It  is  a  most  unwise  practice. 
Unless  you  are  previously  familiar  with 
the  document  in  all  its  parts,  don't  fail 
to  read  it  before  you  buy.  Read  it  all, 
the  little  type  as  well  as  the  big  type, 
the  indorsements,  the  coupons,  and  all. 
Don't  take  somebody's  else  word  for  it. 


28  THE  ART  OF  INVESTING. 

Examine  the  seal,  tlie  signatures,  and 
even  tlie  embellislunents.  Something 
may  be  disclosed  tliat  will  cliange  your 
mind  and  save  your  money. 

But  if  tliere  are  tricks  in  tlie  mak- 
ing of  securities,  even  more  are  to  be  ap- 
prehended in  the  selling  of  them,  and 
should  be  guarded  against  with  corre- 
sponding diligence.  It  is  a  notable 
fact  that  no  poor  securities  are  ever  of- 
fered. They  are  always  good  so  long 
as  they  are  on  the  market.  It  is  only 
after  they  have  been  purchased  that 
they  prove  to  be  worthless.  Interest 
has  never  been  known  to  fail  on  bonds 
that  were  seeking  investors,  although 
default  has  sometimes  followed  very 
closely  on  the  sale  of  the  last  obligation. 
Indeed,  it  is  no  secret  that  interest  is 


INVESTING.  29 


often  paid  out  of  the  proceeds  of  bonds, 
particularly  railroad  issues,  tlie  purchas- 
ers in  tliat  way  getting  a  portion  of 
tlieir  own  money  back  while  the  pro- 
cess of  marketing  them  is  going  for- 
ward, although  such  a  thing  has  seldom 
been  known  to  happen  when  the  entire 
issue  was  disposed  of.  The  advertise- 
ments of  the  bond-sellers  are  sometimes 
marvelous  productions.  ISTo  such  securi- 
ties as  they  have  to  offer  have  ever  been 
on  the  market  before.  They  are  abso- 
lutely safe ;  they  pay  extra  rates  of  in- 
terest, etc.,  etc.  The  wonder  is  that, 
with  so  much  capital  seeking  invest- 
ment, it  is  found  necessary  to  advertise 
such  perfections  at  all.  In  such  cases 
it  is  hardly  necessary  to  say  that  the 
only  safe  rule  for  investors  is   to  find 


30  THE  ART  OF  INVESTING, 

other  uses   for   tlieir   money,    however 
strong  tlie  temptation  may  be. 

A  common  expedient  of  bond-mak- 
ers and  bond-mercbants  is  to  fortify 
tbeir  issues  with  the  favorable  opin- 
ions of  eminent  lawyers.  Tbis  is  par- 
ticularly tbe  case  wben  tbe  obligations 
of  municipalities,  or  of  companies  tbat 
are  dependent  upon  contracts  witb  mu- 
nicipalities, are  offered,  municipalities 
having  shown  an  unpleasant  disposition 
to  go  back  on  their  undertakings.  No 
exception  can  be  taken  to  the  practice 
referred  to,  as  counsel  learned  in  the 
law  should  in  such  cases  always  be  con- 
sulted ;  but  the  writer  has  to  say  that  he 
has  never  yet  known  a  security  so  poor 
that  a  lawyer's  opinion  could  not  be  had 
to  back  it.     Such  testimonials  should  be 


INVESTING.  31 


taken  for  what  they  are  worth,  and  no 
more. 

When  so  many  seductive  baits  are 
offered;  so  many  nets  and  traps,  con- 
trived and  constructed  by  clever  brains 
and  cunning  fingers,  are  spread  for  the 
capture  of  those  having  money,  is  it  sur- 
prising that  the  careless  and  credulous 
are  victimized,  and  even  that  the  saga- 
cious and  prudent  should  sometimes  be 
taken  in?  Nevertheless,  for  the  losses 
they  have  sustained,  investors,  as  a  rule, 
have  themselves  chiefly  to  blame.  The 
mistake  made,  in  nine  cases  out  of  ten, 
has  been  the  purchase  of  cTiewp  securities. 
The  hope  of  realizing  a  little  more  than 
ordinary  interest,  by  buying  paper  at  a 
discount,  has  proved  to  be  the  rock  on 
which  unnumbered  capitalists  have  split. 


32  THE  ART  OF  INVESTING. 

In  addition  to  their  money's  worth,  they 
have  endeavored  to  get  something  for 
nothing,  with  the  result  most  generally 
of  getting  nothing  for  something.  It  is 
remarkable  how  blind  are  people,  ordi- 
narily sagacious  enough  to  make  money, 
to  the  fact  that  property  can  not  pay  a 
revenue  beyond  its  producing  capacity. 
For  instance,  how  can  a  railroad  com- 
pany, whose  line  is  wholly  or  mainly 
built  from  the  proceeds  of  mortgage 
bonds,  sell  them  at  a  heavy  discount, 
besides  allowing  large  commissions  for 
the  selling,  and  then  pay  a  high  rate  of 
interest  on  their  face?  Or  how  can  a 
poor  agriculturist,  occupying  a  half  im- 
proved farm  out  on  the  frontier,  with  a 
family  to  support,  and  grain  selling 
barely  above  the  cost  of  production,  pay 


INVESTING.  33 


ten  or  twelve  per  cent,  npon  tlie  capital 
witlL  whicli  lie  does  business. 

By  what  rule  or  rules  is  the  investor 
to  govern  himself?  No  formula  can 
guarantee  him  absolute  safety.  One 
thing,  however,  he  can  properly  count 
upon,  viz.,  that  he  must  expect  to  pay 
a  fair  price  for  a  good  security — one 
that  Tvdll  return  him  no  more  than  a 
moderate  interest  on  his  money.  If  he 
wants  to  speculate,  and  is  willing  to 
take  risks,  that  is  another  thing.  He 
can  then  look  for  bargains.  As  a 
general  proposition,  it  can  be  asserted 
that  the  day  for  high  prices  for  money, 
as  the  day  for  large  profits  in  trade  or 
manufacturing,  or,  indeed,  in  any  regu» 
larly  recognized  business  with  us,  has 
gone  by.     The  capitalist  who  sends  his 


34  THE  ART  OF  INVESTING. 

money  into  a  new  section,  or  puts  it  into 
a  new  meclianical  process  or  a  new  con- 
structive enterprise,  may  or  may  not 
make  a  Mt,  but  for  the  ordinary  and 
conservative  operator  tlie  condition  of 
tlie  commercial  and  financial  world  gives 
warning  tliat  only  small  profits  are 
to  be  looked  for.  The  first  and  main 
thing  to  be  studied  is  safety.  And  yet 
there  is  such  a  thing  as  going  too  far  in 
the  matter  of  prudence.  The  investor 
may  pay  too  dearly  for  safety.  There 
are  securities  which,  compared  with  oth- 
ers that  are  to  be  had,  sell  at  prices 
much  above  their  real  value.  The  rea- 
son is  that  everybody  knows  them  to  be 
good,  and  investors  who  don't  want  to 
take  the  trouble  to  investigate,  or  are 
afraid   to   trust   both   their  own   judg- 


INVESTING.  35 


ments  and  tlie  counsels  of  their  friends, 
are  willing  to  pay  extra  prices  for  them. 
But  there  are  plenty  of  others  that  may 
be  had  at  lower  figures,  which  are  just 
as  good.  There  is  no  reason  in  the 
world  why  the  investor  should  not  get 
at  par  all  the  paper  he  wants  that  will 
yield  him  six  per  cent,  interest,  and  be 
as  safe  as  any  property  can  be  under  hu- 
man supervision.  As  heretofore  stated, 
with  the  creation  of  new  enterprises  and 
properties,  and  the  development  of  old 
ones,  new  securities  are  constantly  ap- 
pearing in  this  country,  and  a  fair  share 
of  them  ought  to  be  good.  Indeed,  our 
securities  ought  to  be  the  best  in  the 
world.  The  sure  and  rapid  growth  of 
our  resources  supplies  a  reliable  support, 
as  long  as  fair  intelligence  and  common 


36  THE  ART  OF  INVESTING. 

honesty  attend  their  production.  The 
only  thing  is  to  choose  with  discretion, 
so  many  doubtful  and  even  fraudulent 
issues  appearing  at  the  same  time ;  but 
no  more  judgment  is  really  demanded 
than  in  purchasing  lands  and  cattle. 

Two  common  and  often  fatal  mis- 
takes should  be  avoided.  One  is  in  re- 
lying solely  upon  the  advice  of  a  broker. 
No  one  competent  to  form  an  opinion 
for  himself  should  put  his  pecuniary  in- 
terests unreservedly  in  the  keeping  of 
another.  Such  absolute  confidence  in- 
vites betrayal.  By  far  the  greater  num- 
ber of  losses  to  investors  has  been  in 
securities  purchased  exclusively  on  the 
recommendation  of  interested  commis- 
sion men.  While  it  is  well  to  get  the 
opinion  of  a  reputable  broker,  the  pur- 


INVESTING.  37 


chaser  should  investigate  and  decide  for 
himself.  The  other  mistake  is  in  giv- 
ing a  preference  to  "listed"  securities. 
Many  persons  seem  to  think  that 
stocks  and  bonds  must  have  a  value  if 
they  are  quoted  at  some  stock  exchange, 
forgetting  how  many  "fancies"  have 
been  ballooned  until  they  have  burst  at 
such  places.  On  the  contrary,  such  a 
position  is  likely  to  expose  them  to  ma- 
nipulation for  purely  speculative  pur- 
poses. Stock-exchange  quotations,  as  a 
rule,  are  unsafe  guides  to  buyers.  They 
represent  not  so  much  the  value  of  the 
property  as  the  pitch  of  speculation  at 
the  time.  When  securities  are  convert- 
ed into  foot-balls  for  gamblers  to  play 
with,  they  are  pretty  certain  to  be  either 
too    high   or   too   low.      The   only   ad- 


38  THE  ART  OF  INVESTING. 

vantage  they  can  have  is  a  readier  mar- 
ketability in  case  of  an  urgent  need  to 
sell;  but  it  is  at  the  times  when  such 
need  is  likely  to  exist  that  they  are 
pretty  certain  to  be  at  the  lowest  point. 
ISTo  speculative  help  can  long  take  the 
place  of  real  value.  Securities,  in  the 
long  run,  must  stand  upon  their  merits, 
and  purchasers  have  merely  to  follow 
business  principles  as  taught  by  the  can- 
ons of  common  sense. 

In  seeking  investments,  and  espe- 
cially long-time  investments,  there  are 
several  things  to  be  taken  into  account. 
There  is  not  only  the  question  of  the 
kind  of  security  to  purchase,  but  the 
question  of  the  time  to  purchase.  There 
are  opportunities  to  be  looked  for  as 
well   as  pitfalls  to  be  shunned.     It  is 


INVESTING.  39 


during  periods  and  seasons  of  depression, 
when  securities  are  forced  upon  tlie  mar- 
ket, often  to  be  sacrificed — and  they  are 
certain  to  come  if  waited  for  long  enougli 
— that  the  shrewd  investor  finds  his  rich- 
est harvest.  That,  however,  can  not  be 
said  of  the  ordinary  investor.  He  usu- 
ally buys  when  securities  are  up  and 
confidence  is  unimpaired,  and  becoming 
frightened  as  market  values  go  down 
sells  when  they  are  at  the  bottom,  and 
holds  his  money  to  reinvest  in  something 
else  no  better,  and  probably  not  as  good, 
when  the  tide  has  turned.  As  a  rule, 
the  best  time  to  invest  is  when  others 
are  unloading.  In  money  matters  it  is 
never  safe  to  follow  "  the  crowd."  Nor 
is  it  safe  (which,  however,  is  little  more 
than  the  expression  of  the  same  idea  in 


40  THE  ART  OF  INVESTING. 


another  form)  to  purchase  a  security 
when  it  is  on  the  "  boom."  A  pecul- 
iarity of  our  money  market,  conservative 
as  it  is  popularly  supposed  to  be,  is  that 
it  is  constantly  changing  its  favorites. 
Its  offerings  come  in  waves.  Its  deal- 
ings at  one  time  may  be  chiefly  in  rail- 
ways, at  another  in  municipal  obligations, 
and  at  another  the  excitement  may  run 
to  mining  shares  or  mortgages  on  ranches 
and  real  estate.  For  the  time  all  pro- 
fessional brokers  and  bond  and  share 
sellers  ui^ge  their  customers  to  adopt  the 
popular  issue,  of  which,  as  the  result  of 
the  increased  demand,  there  is  almost 
certain  to  be  an  excessive  if  not  fraudu- 
lent production.  To  yield  to  the  press- 
ure at  such  a  time  is  always  risky. 
Old     and     tried     securities,     like     old 


INVESTING.  41 


friends,  are  likely  to  be  tlie  truest  and 
best. 

One  tiling  tlie  investor  would  do 
well  never  to  forget,  viz.,  that  tliere  is 
always  plenty  of  good  securities  in  the 
market.  No  one  mtk  money  need  ever 
fear  that  others  will  get  all  the  solid  in- 
vestments, and,  in  the  apprehension  that 
there  will  not  be  enough  of  that  sort  to 
go  round,  put  up  with  an  inferior  article. 
Don't  let  him  choose  what  is  not  alto- 
gether satisfactory,  under  the  impression 
that  nothing  else  as  good  or  better  will 
offer.  If  he  does  so,  sooner  or  later  he 
will  regret  it.  Something  good  always 
comes  to  him  who  waits  with  money 
in  his  hand. 

Another  thing  of  a  precautionary  na- 
ture it  is  well  enough  for  the  investor  to 


42  THE  ART  OF  INVESTING. 

do,  and  tliat  is  to  scatter  Ids  purchases. 
The  old  adage  about  putting  all  the 
eggs  in  one  basket  applies  with  peculiar 
force  to  investments.  The  tendency  with 
those  having  but  moderate  sums  to  place 
at  usury,  and  who  need  to  be  the  most 
circumspect,  is  to  make  up  their  minds 
in  favor  of  a  single  line  of  securities  and 
put  everything  there.  Of  course,  a  fail- 
ure in  that  quarter  is  particularly  disas- 
trous. The  writer  knew  a  party,  some 
years  ago,  who  decided  in  favor  of  mu- 
nicipal obligations,  saying  that  he  had 
satisfied  himself  that,  on  the  whole,  there 
was  nothing  else  so  reliable.  Accord- 
ingly he  put  his  entire  available  means 
into  them.  But  practicing  abundant 
precaution,  as  he  supposed,  he  divided 
his  money  equally  among  municipal  is- 


GOVERNMENTS.  43 

sues  of  Illinois,  Missouri,  and  Kansas, 
tliey  having  the  most  paper  at  that  time 
on  the  market.  He  thought  he  was  cer- 
tainly safe  as  to  part.  But  soon  after- 
ward a  wave  of  repudiation  sentiment 
swept  over  that  part  of  the  country,  and 
every  one  of  his  bonds  was  left  in  de- 
fault. It  is  weU  enough  to  scatter  in 
kind  as  well  as  in  locality. 

With  these  preliminary  observations, 
as  a  further  aid  in  making  a  choice  it 
may  be  well  to  take  up  the  different 
kinds  of  investments  and  consider  them 
separately. 

GOVEEIS-MEI^TS. 

Of  these  there  were  at  one  time  out- 
standing over  two  and  a  half  billion  dol- 
lars ;  and,  of  course,  a  great  deal  of  in- 


44  THE  ART  OF  INVESTING. 

vestors'  capital  found  accommodation 
tliere,  witli  satisfactory  returns ;  but  tlie 
amount  lias  so  diminislied,  and  is  so  rap- 
idly diminisMng,  while  prices  liave  cor- 
respondingly advanced,  tliat  private  par- 
ties who  want  to  get  the  most  they  can 
for  their  money  no  longer  look  to  that 
quarter.  It  is  only  when  a  place  is 
sousrht  for  trust  and  other  funds  for 
which  safety  and  facility  of  conversion 
are  wanted  rather  than  a  high  rate  of 
interest,  that  governments  are  to  be  con- 
sidered. They  are  absolutely  good  and 
always  marketable,  but  they  are  no  long- 
er to  be  classed  with  investments  whose 
claims  call  for  serious  discussion. 

The  foregoing  remarks,  it  is  hardly 
necessary  to  add,  refer  exclusively  to  the 
obligations  of  our  own  Government.     If 


GO  VERNMENTS.  45 

we  pass  beyond  tlie  limits  of  this  coun- 
try, we  find  not  only  an  abundance  of 
government  issues  tliat  are  seeking  buy- 
ers in  tlie  markets  of  the  world,  but  a 
corresponding  variety  in  values  and  quo- 
tations. It  is  estimated  that  the  civil- 
ized nations  of  the  globe  now  owe,  with- 
out including  local  or  divisional  imder- 
takings,  not  less  than  $27,000,000,000,  a 
sum  which,  if  equally  distributed,  would 
impose  an  incumbrance  of  $720  on  every 
square  mile  of  their  territory,  and  a  per 
capita  indebtedness  of  $23  on  all  their 
subjects.  The  foregoing  amount  has  ne- 
cessarily absorbed  a  very  large  propor- 
tion of  the  world's  investment  capital, 
and,  as  its  tendency  in  many  localities  is 
to  increase,  it  will  continue  to  hold  it 
for  many  generations  to  come.     But,  as 


46  THE  ART  OF  INVESTING. 

we  in  America  can  create  more  liome 
calls  for  money,  tlie  manufacture  of  se- 
curities being  one  of  our  chief  indus- 
tries, tlian  we  can  supply,  there  is  no 
disposition  among  us  to  go  abroad  for 
investments,  and  we  need  not  concern 
ourselves  about  the  offerings  made  else- 
where. 

State  Obligation's. 

The  unquestioned  credit  of  "  govern- 
ments "  has  led  many  persons  to  the  in- 
ference that  the  next  safest  and  best 
investment  securities  are  the  obligations 
of  the  States,  as  they  rank  second  only 
to  the  national  authority.  How  far  that 
impression  is  verified  by  the  facts  of  the 
case  will  appear  from  the  statement 
that,  of  about  twenty  of  the  thirty- 
eight  States  of  the  Union  that  have  out 


STATE  OBLIGATIONS.  47 

sufficient  paper  to  test  their  dispositions 
in  tlie  matter  of  paying  debts,  only  eiglit 
or  nine  faithfully  keep  all  their  agree- 
ments, and  as  many  as  twelve,  being 
nearly  one  third  of  the  whole  number, 
are  in  default  as  to  all  or  portions  of 
their  outstanding  obligations;  that  the 
State  bonds  that  are  promptly  provided 
for  amount  to  a  little  over  $100,000,000, 
while  the  principal  of  those  that  are 
defaulted  on  or  have  been  in  default 
(some  of  them  compromised  by  the  sub- 
stitution of  issues  of  reduced  amounts) 
is  not  far  from  $200,000,000 ;  and  that 
the  sum  total  of  the  delinquency,  when 
unpaid  interest  is  added,  exceeds  $300,- 
000,000. 

It  is  true  that  a  considerable  portion 
of  the  last-mentioned  figure  is  made  up 


48  THE  ART  OF  INVESTING. 

of  what  are  known  as  "carpet-bag 
bonds,"  having  been  put  out  by  States 
that  had  been  in  rebellion  during  the 
process  of  their  reconstruction,  and 
which  are  repudiated  on  the  alleged 
ground  that  the  governments  creating 
them  did  not  fairly  represent  the  peo- 
ple of  the  States.  But  that  is  by  no 
means  true  of  all.  Virginia  owes  the 
larg^est  amount,  and  the  whole  of  her 
indebtedness  was  created  before  the  war. 
The  same  thing  can  be  said  of  Missis- 
sippi's debt  and  of  the  most  of  that  of 
Tennessee  and  some  of  the  other  de- 
linquent States. 

When  the  reasons  for  their  failure 
to  maintain  their  credit  are  sought  for, 
the  most  potential  and  obvious  is  found 
in  the  fact  that  States,  under  the   na- 


STATE  OBLIGATIONS.  49 

tional  Constitution,  can  not  be  sued  or 
otherwise  legally  proceeded  against  on 
account  of  their  pecuniary  undertakings, 
at  least  to  private  parties,  and  tliat  con- 
sequently there  is  no  way  to  compel 
them  to  pay  if  they  are  indisposed  to 
pay.  Some  of  them  have  shown  that 
they  are  not  above  taking  advantage  of 
the  situation.  This  is  the  more  to  their 
discredit,  because  it  was  not  the  inten- 
tion of  the  Constitution's  framers  that 
they  should  enjoy  any  such  exemption. 
The  Constitution  originally  gave  a  right 
of  action  against  the  States.  The 
eleventh  amendment,  which  inhibits  the 
suing  of  States  by  private  parties,  thus 
taking  away  a  right  previously  existing, 
was    meant  to    cut    off    certain    claims 

growing  out  of  the  Eevolutionary  War 
5 


50  THE  ART  OF  INVESTING. 

and  for  no  other  purpose,  no  one  at  the 
time  of  its  adoption  dreaming  that  it 
would  be  used  by  the  States  to  shield 
themselves  from  subsequently  contracted 
liabilities.  The  States  that  thus  avail 
themselves  of  it  are  really  guilty  of  a 
double  fraud.  But  the  fact  that  so 
many  of  them  have  not  scrupled  to  do 
so,  shows  the  danger  of  trusting  to  their 
pecuniary  promises. 

Whoever  buys  the  paper  of  a  State 
should  do  so  with  the  distinct  under- 
standing that  he  has  nothing  but  its 
honor  to  rely  upon,  unless  the  commer- 
cial relations  of  its  citizens  should  be 
of  such  a  character  as  to  make  its  finan- 
cial credit  important  to  their  business 
interests.  There  is  for  that  reason  little 
likelihood  of  such  States  as  New  York 


STATE  OBLIGATIONS,  51 

and  MassacliTisetts  ever  repudiating  their 
obligations.  But  when  such  conditions 
do  not  exist,  the  faith  of  a  State  is  an 
uncertain  dependence.  The  public  con- 
science in  the  matter  of  commonwealth 
obligations  is  notoriously  lax,  what  is 
everybody's  duty  being  looked  upon  as 
no  particular  individual's;  and  such  a 
thing  as  State  pride,  except  in  the  form 
of  prejudices  and  antipathies,  which  are 
very  likely  to  be  directed  against  public 
creditors,  can  scarcely  be  said  to  exist. 
Of  all  the  States,  Virginia  has  professed 
the  highest  regard  for  her  reputation, 
yet  she  has  been  the  most  brazen  of 
repudiators. 

How  easy  it  is  for  a  State  to  ignore 
its  contracts  without  attracting  public 
attention    to    its    conduct   is   strikingly 


52  THE  ART  QF  INVESTING. 

shown  in  the  case  of  Texas,  whidi  is  not 
one  of  the  twelve  bond  repndiators  re- 
ferred to.  Texas  has  issued,  and  now 
has  outstanding,  agreements  to  furnish 
land  from  her  public  domain  calling  for 
about  eight  million  acres,  an  area  near- 
ly three  times  the  size  of  Connecticut, 
which  she  does  not  supply  to  the  cer- 
tificate holders.  No  charge  has  ever 
been  made  that  the  warrants  were  ille- 
gally issued  by  the  State  or  improperly 
obtained  by  those  owning  them.  The 
State  had  the  land  when  they  were  cre- 
ated, and  could  without  difficulty  have 
met  her  agreements ;  but,  after  the  war- 
rants were  out,  she  proceeded  to  give 
away  such  extensive  areas  for  the  build- 
ing of  a  State  house,  for  the  endowment 
of    universities,    for   the   pensioning  of 


STATE  OBLIGATIONS.  53 

wounded  Confederate  soldiers,  and  for 
other  local  purposes,  tliat  tlie  holders  of 
her  land  scrip  can  get  no  satisfaction. 
As  matters  stand,  the  State  has  the  con- 
sideration for  the  land,  but  those  who 
have  her  paper  can  get  neither  land  nor 
money ;  and  although  this  condition  of 
things  has  existed  for  several  years, 
during  which  there  have  been  several 
sessions  of  her  legislature,  Texas  has 
taken  no  steps  to  redress  the  wrong  she 
has  done,  and  there  seems  to  be  very 
little  desire  on  the  part  of  either  offi- 
cials or  citizens  that  reparation  should 
be  made  or  concern  about  the  dis2:race 
that  attaches  to  them  and  to  their 
State. 

A  very  little  reflection  suffices    to 
teach    the    unreliability  of    obligations 


54  THE  ART  OF  INVESTING. 

resting  upon  no  more  substantial  sup- 
port tlian  public  opinion.  Divided  re- 
sponsibilities are  always  lightly  es- 
teemed, while  no  burdens  are  so  sharply 
felt  as  those  imposed  by  the  common- 
wealth. Tax-payers  will  shrink  from 
public  debts,  who  would  never  think  of 
shirking  individual  liabilities.  National 
pride  and  the  other  elements  of  which 
patriotism  is  compounded,  even  in  cases 
where  there  may  be  no  pressure  from 
the  governments  of  foreign  bond-hold- 
ers, may,  and  probably  will  be  sufficient 
to  protect  national  agreements,  but  the 
undertakings  of  subordinate  communi- 
ties need  more  positive  backing.  It 
does  not  follow  that  there  will  be  no  re- 
pudiation because  of  an  honest  purpose 
in  their  contracting.     There  is   always 


STATE  OBLIGATIONS.  55 

the  possibility  of  political  or  other  dis- 
turbances that  may  lead  to  revulsion  of 
sentiment  or  give  demagogues  the  op- 
portunity to  assail  the  public  credit. 
We  are  not  without  illustrations  in  this 
country.  Virginia's  bonds  at  one  time 
commanded  higher  prices  than  those  of 
the  Federal  Government ;  yet  they  are 
to-day  selling  at  figures  far  below  par, 
and  some  of  them,  or  the  certificates 
representing  them,  can  be  purchased  for 
a  few  cents  on  the  dollar.  That  they 
and  State  debentures  generally,  when 
all  the  contingencies  attending  them  are 
considered,  should  bring  as  liberal  prices 
as  they  do,  is  the  only  thing  about  it 
that  is  surprising.  Such  securities,  in 
the  writer's  judgment,  are,  at  present 
quotations,    beyond    all    question,    the 


56  THE  ART  OF  INVESTING. 

dearest    investments    we    have    in    tlie 
market. 

MmnciPAL   Obligations. 

What  has  just  been  said  concerning 
State  undertakings  is,  in  part,  true  of 
these.  How  ready  our  minor  communi- 
ties are  to  create  debts,  and  then  ignore 
them,  has  been  proved  by  very  many 
illustrations,  some  of  them  of  recent 
date.  With  the  revival  of  general  busi- 
ness at  the  close  of  the  war,  came  a 
period  of  rapid  development  in  some  of 
the  newer  parts  of  the  country.  Nu- 
merous railways  were  projected,  and 
municipalities  were  called  upon  to  aid 
in  their  construction  by  the  donation  of 
bonds.  The  market  was  soon  flooded 
with  them,  particularly  from  the  States 


MUNICIPAL   OBLIGATIONS.  57 

of  Illinois,  Missouri,  Kansas,  Arkansas, 
and  their  immediate  neighbors.  But 
tlie  enthusiasm  that  led  to  their  creation 
was  quickly  succeeded  by  disgust  when 
the  bui^dens  they  imposed  began  to  be 
felt.  Many  were  repudiated,  and,  but 
for  fear  of  the  courts,  that  would  have 
been  the  case  practically  as  to  all.  In 
Missouri  a  Repudiators'  State  conven- 
tion was  held,  and  resolutions  denying 
all  moral  responsibility  on  account  of 
municipal  issues,  and  advising  general 
legal  resistance,  were  published  to  the 
world.  Nearly  one  half  of  the  indebted 
cities,  counties,  and  towns  of  Illinois  and 
Kansas  denied  their  liability,  and  in  Ar- 
kansas repudiation  was  universal.  Nor 
were  there  lacking  such  examples  in  the 
East.      Very  many  investors  who   had 


58  THE  ART  OF  INVESTING. 

put  their  money  into  tlie  rejected  bonds, 
became  frightened,  and  sold  out  at  what- 
ever figures  they  could  get.  The  aggre- 
gate loss  was  very  great. 

Nor  are  such  cases  at  an  end.  The 
writer  has  before  him,  as  these  pages 
are  being  prepared,  a  number  of  certifi- 
cates of  indebtedness  recently  put  out 
by  one  of  the  best-known  and  most 
wealthy  counties  of  Colorado.  One  of 
the  warrants  was  issued  in  payment  for 
furniture  for  the  local  court  of  justice, 
several  for  salaries  of  county  officials,  a 
number  for  witness-fees,  etc.  All  were 
created  for  purposes  entirely  proper  and 
necessary,  and  yet  payment  is  absolutely 
refused. 

As  a  general  thing,  repudiated  mu- 
nicipal undertakings,  being  sustained  by 


MUNICIPAL   OBLIGATIONS,  59 

the  courts,  have  in  the  end  been  paid  or 
compromised;  but  many  of  them  have 
been  defeated  on  technical  grounds,  and 
proved  wholly  worthless  in  innocent 
purchasers'  hands.  The  wealthy  capital 
of  the  State  of  Kansas,  to  the  State's 
disgrace  as  weU  as  her  own,  has  to-day 
outstanding  $100,000  of  bonds  which 
she  does  not  pay  because  the  courts 
have  held  that  she  can  not  be  legally 
compelled  to  pay  them !  Everybody 
has  heard  of  the  case  of  Memphis,  Ten- 
nessee, which,  in  order  to  escape  pro- 
ceedings for  the  enforcement  of  her  obli- 
gations, got  her  charter  repealed,  and 
ceased  to  be  an  organized  city. 

What  has  been  said  concerning  the 
moral  strength,  or  rather  moral  weak- 
ness, of  State   bonds,  will  apply  with 


6o  THE  ART  OF  INVESTING. 

equal  force  to  those  put  out  by  munici- 
palities. The  people  in  tlie  one  case 
are  no  more  honest  than  in  the  other  ; 
and  local  pride,  except  on  the  part  of  a 
few  leading  commercial  cities,  in  such 
matters  counts  for  very  little.  Never- 
theless, as  will  be  seen,  municipal  obli- 
gations have  an  important  element  of 
security  that  State  issues  do  not  possess. 
Their  collection,  provided  they  are  prop- 
erly created,  can  be  legally  enforced. 
But  this  fact  should  be  accepted  for  no 
more  than  it  is  worth.  While  the  bulk 
of  the  paper  put  out  by  our  municipali- 
ties is  undoubtedly  good,  the  only  safe 
course  in  buying  it,  in  very  many  in- 
stances— ^possibly  a  majority — is  to  pro- 
ceed upon  the  assumption  that  payment 
will  not  be  made  if  it  can  be  avoided, 


MUNICIPAL   OBLIGATIONS.  6i 

and  to  graduate  prices  as  well  as  adopt 
precautions  in  accordance  witb.  tliat 
view.  The  aspect  of  tlie  matter  pre- 
sented is  not  particularly  charitable  or 
flattering;  but,  whoever  invests  his 
money  on  a  different  one,  runs  an  excel- 
lent chance  of  losing  it. 

Hence,  in  taking  municipal  securi- 
ties, it  wiU  be  seen  how  important  it  is 
that  all  points  affecting  their  validity 
should  be  inquired  into.  One  of  the 
first  questions  to  be  settled  is  whether 
they  have  been  the  subject  of  litigation, 
and  what,  in  that  case,  has  been  the  re- 
sult. Another  is  whether  they  belong 
to  the  original  issue,  or  have  been  put 
out  in  settlement  of  an  earlier  and  dis- 
puted series.  Compromise  municipal 
bonds    have   generally    been    good,   al- 


62  THE  ART  OF  INVESTING. 

thougli  there  have  been  instances  in 
which  even  they  have  met  with  opposi- 
tion from  their  makers.  Fortunately 
for  later  buyers,  the  litigation  affecting 
municipal  undertakings  has  been  so  ex- 
tensive that  nearly  all  questions  that  can 
possibly  involve  their  validity  have 
been  passed  upon  by  the  courts,  and  it 
is  not,  therefore,  now  a  difficult  matter 
to  determine,  if  reasonable  prudence  is 
exercised  when  such  securities  are  of- 
fered, whether  they  will  stand  the  legal 
test.  But,  of  course,  legal  considerations 
are  not  the  only  ones  to  be  studied. 
The  pecuniary  responsibility  and  gen- 
eral credit  of  the  contracting  communi- 
ties should  not  be  overlooked. 

The    importance    of    the    position 
among  investments  that  is  held  by  mu- 


MUNICIPAL  OBLIGATIONS.  63 

nicipal  issues  is  apparent  as  soon  as  we 
consider  tlie  formidable  sum  which,  in 
the  aggregate,  they  make  up.  In  1880, 
according  to  the  census  taken  that  year, 
they  amounted  to  $871,507,373.  But, 
enormous  as  that  figure  appears  to  be,  it 
was  considerably  short  of  the  actual  to- 
tal, because  very  many  issues  were  then 
repudiated  or  in  litigation,  and,  their  va- 
lidity being  denied,  they  were  not  re- 
ported to  the  census-takers  by  the 
makers  of  them  as  any  part  of  their 
debts.  The  most  of  them  have  been 
sustained,  and  with  them  and  the  addi- 
tions that  have  since  been  made  in  new 
undertakings,  the  present  aggregate 
would  doubtless  considerably  exceed  a 
thousand  million  dollars.  A  great  deal 
of   investment   capital    is,  therefore,  in 


64  THE  ART  OF  INVESTING, 

them.  In  tlie  main  it  is  well  and  profit- 
ably placed.  As  our  cities  and  otlier 
municipalities  grow  in  wealth  and  popu- 
lation, they  become  better  able  to  take 
care  of  the  paper  they  have  out ;  partic- 
ularly as  their  debts  of  late  years  have 
not  increased  as  they  formerly  did.  A 
number  of  the  States  have  by  constitu- 
tional enactment  prohibited  their  com- 
munities from  making  donations  of 
bonds  to  railroads  and  other  corporate 
enterprises,  and  others  have  so  re- 
stricted them  that  the  worst  abuses  of 
the  practice  are  no  longer  possible.  On 
the  whole,  if  proper  precautions  are 
taken  by  the  buyers,  municipal  paper 
may  now  be  looked  upon  as  one  of  our 
safest  and  most  remunerative  invest- 
ments. 


RAILROAD  MORTGAGES.  65 

Eailkoad  Moetgages. 

We  have  now  come  to  a  class  of 
securities  in  wliicli  by  far  the  greatest 
amount  of  money  has  been  invested ; 
much  of  it  permanently,  as  the  class 
under  consideration  has  been  the  grave- 
yard of  a  vast  aggregate  of  capital.  An 
idea  of  the  volume  of  interest-bearing  ob- 
ligations predicated  upon  railway  prop- 
perty  in  this  country  can  be  formed 
when  it  is  known  that,  at  the  time  these 
pages  are  written  (1887),  our  operated 
raiboad  lines,  all  told,  foot  up  not  less 
than  one  hundred  and  thirty-three  thou- 
sand miles.  The  portion  that  is  unen- 
cumbered is  so  small  as  to  be  scarcely 
worth  considering.  The  average  funded 
indebtedness  is  about  $30,000  per  mile. 


66  THE  ART  OF  INVESTING. 

or,  in  all,  $4,000,000,000.  But  tliat 
figure,  enormous  as  it  is,  by  no  means 
tells  the  whole  story.  So  many  rail- 
roads liave  been  foreclosed  and  sold 
under  one  series  of  bonds,  tliat  they 
might  be  used  in  reorganization  pro- 
ceedings as  a  basis  for  another  issue — 
the  process  in  some  cases  being  several 
times  repeated  —  that  it  would  proba- 
bly be  no  exaggeration  to  say  that  the 
liability,  one  time  or  another  created, 
would  average  nearly  $50,000  per  mile, 
or  a  grand  total  of  $6,000,000,000. 

As  our  railways,  with  few  excep- 
tions, are  valuable  and  productive  proper- 
ties, they  furnish  an  excellent  security 
for  interest-bearing  paper,  provided  al- 
ways that  they  are  properly  managed 
and  not  overburdened  with  debt.     There 


RAILROAD  MORTGAGES.  67 

are  at  all  times  good  railroad  bonds  in 
the  market;  the  trouble  is,  that  there 
are  poor  ones  there  also.  How  is  the 
investor  to  discriminate  between  them  ? 
When  the  mortgages  are  on  roads  that 
have  been  in  operation  for  considerable 
periods,  there  is  little  difficulty  in  reach- 
ing safe  conclusions.  The  principal 
question  involved  is  that  of  earning 
capacity,  considered  in  connection  with 
amounts  of  funded  liability,  and  our 
railroad  manuals  furnish  all  needed 
data  on  those  points.  Of  course,  there 
is  always  a  danger  from  rival  enterprises 
in  the  shape  of  "  paralleling "  lines, 
and  possibly  a  greater  one  from  speculat- 
ing directors,  who  are  willing  to  wreck 
the  properties  intrusted  to  their  charge ; 
but  the    peril   is   small   in   comparison 


THE  ART  OF  INVESTING. 


with  the  interests  involved.  The  puzzle 
is  when  it  comes  to  the  paper  of  new 
roads — of  roads  that  are  in  course  of 
construction  or  Just  completed — and  gen- 
erally by  far  the  greatest  amount  of 
railroad  bonds  offering  in  the  market 
is  of  this  description.  Here  the  earn- 
ings guide-board  is  lacking.  By  what 
rule  or  rules  is  the  investor  in  such 
cases  to  govern  himself  ? — ^because  many 
of  the  new  securities  are  good,  and  as 
they  can  be  had  at  lower  figures  than 
old  ones,  when  properly  sifted  from  the 
others  they  offer  bargains  that  should 
not  be  neglected.  The  answer  involves 
a  brief  description  of  the  prevailing 
methods  of  railway  construction. 

It  is  quite  within  bounds  to  say  that 
the  principal  incentive  to  the  building 


RAILROAD  MORTGAGES. 


of  railroads  nowadays  is  the  expecta- 
tion of  making  profit  out  of  their  con- 
struction. The  time  for  making  roads 
at  a  sacrifice  to  their  projectors,  and 
because  they  are  wanted  by  the  public, 
has  gone  by.  Kailroad-building  is  now 
a  regular  industry — as  much  so  as  the 
erection  of  houses  or  the  manufacture 
of  machinery.  When  a  new  railway 
enterprise  is  undertaken,  its  authors  ex- 
pect to  make  the  road  not  only  supply 
funds  for  its  own  construction,  but  to 
leave  them  a  handsome  balance  over. 
This  is  accomplished  by  mortgaging  the 
property  to  that  extent  that  the  bonds 
can  be  sold  for  more  than  it  will  cost. 
In  that  case  they  are  very  likely  to 
exceed  in  amount,  although  not  always 
necessarily   so,   the    security   on   which 


70  THE  ART  OF  INVESTING, 

they  rest ;  in  other  words,  be  composed, 
in  good  part,  of  "water."  Default  in 
tlie  payment  of  interest,  and  the  bank- 
ruptcy of  the  enterprise,  are  the  usual 
consequences.  What  follows  is  matter 
of  routine.  The  property  is  put  into 
the  hands  of  a  receiver,  the  securities  are 
effectually  discredited — perhaps  bought 
up  by  a  syndicate  of  crafty  speculators 
— and  then  the  work  of  reorganization 
is  entered  upon.  The  reorganizing  of 
broken-down  railroads  has  become  an- 
other regular  and  profitable  business. 
Calculation  is  made  to  determine  on 
how  many  obligations  the  property  can 
earn  interest,  and  it  is  arranged  to  re- 
issue for  that  amount,  the  old  securities 
being  proportionately  exchanged  and  re- 
tired.    Their  holders,  who  are  usually 


RAILROAD  MORTGAGES.  71 

glad  to  save  sometliing  out  of  the  wreck, 
are  expected  to  accept  bonds  for  a 
smaller  face  value,  and  probably  at  a 
reduced  rate  of  interest,  and  at  the  same 
time  meet  a  cash  assessment  to  cover 
the  cost  of  the  operation.  They  not 
only  have  the  water  squeezed  out  of 
their  holdings,  but  they  have  to  pay 
for  the  squeezing. 

The  lesson  to  be  drawn  from  the 
foregoing  facts  is  easily  stated.  Let 
the  investor,  before  he  purchases,  ascer- 
tain whether  the  bonds  offered  him  are 
secured  on  a  road  that  has  gone  through 
the  reorganization  process;  and  if  not, 
unless  he  feels  that  he  is  compensated 
for  the  risk  he  takes  by  a  great  reduc- 
tion in  price,  he  had  better  keep  his 
money,  or  find  some  other  place  for  it. 


72  THE  ART  OF  INVESTING, 

Reorganization  is  almost  certain  to  come 
sooner  or  later.  It  is  tlie  rock  ahead. 
There  are  exceptional  cases,  of  course, 
and  if  tlie  investor  has  the  means  of 
making  a  thorough  investigation,  he  can 
take  advantage  of  them;  but  he  ought 
to  be  very  sure  of  the  ground  before 
venturing  upon  it. 

Raileoad  Stocks. 
Of  course,  many  of  these  are  good, 
and  a  great  deal  of  money  is  profitably 
invested  in  them ;  but,  as  a  rule,  rail- 
way bonds,  while  at  times  possibly  not 
yielding  as  liberal  returns,  are  much  to 
be  preferred  by  ordinary  capitalists. 
There  are  many  things  endangering 
stocks  that  do  not  threaten  mortgage 
bonds.      The    latter   are   secured   upon 


RAILROAD  STOCKS.  73 

property  that  is  permanent,  but  the 
value  of  stocks  rests  upon  management 
that  is  subject  to  constant  change.  The 
ambition  of  railroad  directors  is  even 
more  to  be  dreaded  than  their  dishon- 
esty. How  many  magnificent  railway 
properties  have  been  ruined  by  the  sui- 
cidal policy  of  extending  roads,  adding 
branches  or  taMng  on  leased  lines ! 
More  particularly  has  this  been  the  case 
when  their  stocks  are  listed  at  some 
exchange,  and  their  managers  happen 
to  be  operators  there.  The  temptation 
to  increase  or  diminish  quotation  values, 
for  speculating  purposes,  is  then  a 
constant  menace  to  conservative  share- 
holders. The  fact  that  a  stock  pays 
dividends,  which  is  the  only  thing  that 
the  most  of  investors  look  to,  is  no  cer- 


74  THE  ART  OF  INVESTING. 

tain  criterion  of  value  unless  tlie  con- 
trol of  the  property  can  in  some  way 
be  satisfactorily  guaranteed, 

Othee  Stocks. 
Of  tliese  tliere  is  no  end.  Tlie  tend- 
ency of  business,  owing  partly  to  an 
abundance  of  capital  and  partly  to  in- 
creasing competition,  is  to  a  large  scale 
of  operations,  if  not  to  absolute  monop- 
oly. One  consequence  is,  that  it  is  more 
and  more  passing  from  private  parties 
into  the  hands  of  corporations.  Cor- 
porations issue  stocks,  and  sometimes 
that  is  one  of  the  leading  purposes  of 
their  formation.  Some  of  the  stocks 
are  good  and  a  good  thing  to  have,  and 
others  are  wholly  worthless.  No  rule, 
beyond  the  exercise  of  common  sense, 


OTHER  STOCKS.  75 

and  the  use  of  diligence  in  acquiring 
reliable  information,  can  be  given  for 
their  selection.  Some  dangers,  however, 
can  be  pointed  out.  The  greatest  of 
these  is  the  temptation  of  large  divi- 
dends. Investors  are  altogether  too 
prone  to  accept  present  realizations  as 
evidences  of  future  profits.  It  may  be 
taken  as  a  rule  that,  in  this  age  of 
plentiful  money,  no  legitimate  business 
that  is  open  to  public  competition  will 
long  pay  exceptionally  well.  The  greater 
its  earnings  at  first,  the  stronger  will  be 
the  competition  in  the  end.  Hence  we 
find  that  many  manufacturing  compa- 
nies, especially  in  New  England,  that 
made  handsome  returns  to  their  share- 
holders for  considerable  periods,  have 
gradually   ceased   to   pay   dividends   at 


76  THE  ART  OF  INVESTING. 

all,  or  been  forced  into  liquidation.  If 
not  strictly  a  legitimate  business,  any- 
thing in  the  nature  of  profits  must  be 
deceptive. 

When  corporations  enjoy  monopolies 
by  virtue  of  patent  rights,  their  earnings 
have  often  been  very  great,  and  early 
investors  have  made  splendid  fortunes. 
Those  who  come  later,  however,  take 
chances  that  are  too  frequently  under- 
estimated. There  is  always  the  danger 
of  new  discovery.  Gas  is  threatened  by 
electricity,  the  telegraph  by  the  tele- 
phone, and  even  steam  is  menaced  by 
new-fangled  motors.  Turnpikes  and  ca- 
nals have  been  superseded  by  railways, 
and  old  railroads  may  at  any  time  suffer 
from  the  competition  of  new  ones.  An- 
other fact  which  is  too  often  lost  sight  of 


OTHER  STOCKS,  77 

is  that  investing  in  a  patent  right,  or  in  a 
business  founded  upon  it,  is  like  invest- 
ing in  a  mine  that  is  being  constantly 
worked  out.  Every  hour  shortens  its 
monopoly.  But  the  greatest  danger  in 
such  cases  is  over-capitalization.  Such 
stocks  nearly  always  contain  too  much 
water,  and  water  invariably  tends  to 
lower  levels. 

In  handling  shares  the  highest  art  is 
in  selling  rather  than  in  buying.  That 
is  something  that  the  most  of -investors 
do  not  understand.  They  hold  on  too 
long.  When  they  have  a  good  thing, 
they  infer  that  it  will  always  remain  so, 
and  accordingly  retain  it  until  its  value 
has  departed  or  greatly  deteriorated. 
Stocks  require  constant  watching.  If 
any  one  wants  to  go  to  sleep  on  his  in- 


78  THE  ART  OF  INVESTING. 

vestments  lie  had.  better   select   mort- 
gages. 

While  it  is  true  that  numerous  stocks 
are  very  much  like  lottery-tickets  —  a 
good  many  of  them,  and  among  them 
the  shares  of  mining  companies,  from 
the  very  nature  of  the  case — and  deal- 
ing in  them  is  a  species  of  gambling, 
the  observation  is  not  true  as  to  all. 
The  law  watches  over  some  of  them  in 
a  way  to  protect  them  from  the  most 
obvious  dangers.  For  that  reason,  bank- 
stocks  can  generally  be  relied  upon  as 
representing  actual  cash  investments. 
In  some  of  the  States  the  same  thing 
is  true  of  insurance  companies'  shares. 
Efforts  have  even  been  made,  in  certain 
quarters,  to  apply  the  rule  to  all  cor- 
porations; but,  as  the  corporation  laws 


FARM  MORTGAGES.  79 

of  other  States  are  generally  open  for 
anybody  to  organize  under,  sncli  restric- 
tions have  little  practical  value.  In 
acquiring  stocks,  it  is  always  well  to  in- 
quire— a  point  generally  overlooked — 
under  what  statutes  the  companies  have 
been  organized.  If  they  are  found  to 
exist  by  virtue  of  the  corporation  laws 
of  States  that  are  notoriously  lax  in 
their  requirements  —  especially  if  their 
corporators  are  residents  of  other  States 
—  the  presumption  is  against  them. 
There  is  pretty  certain  to  be  bad  faith 
in  their  inception,  and  a  bad  beginning 
is  likely  to  make  a  bad  ending. 

Faem  Moetgages. 
We   have   now   reached   a   class    of 
securities  that  has  been  steadily  grow- 


8o  THE  ART  OF  INVESTING. 

ing  in  popularity,  and  more  and  more 
has  absorbed  tlie  capital  of  investors. 
That  it  must  have  merit  is  a  fair  infer- 
ence. All  things  considered,  it  is  doubt- 
less the  best  now  offered  on  a  large 
scale.  Land  in  this  country  is  steadily 
appreciating,  except  in  a  few  of  the 
older  sections.  There  is  no  reason  to 
apprehend,  at  least  for  years  to  come,  a 
turn  in  the  tide.  Hence,  paper  resting 
upon  landed  security,  especially  in  the 
newer  and  more  rapidly-developing  dis- 
tricts, if  properly  graduated  in  amount, 
is  almost  certain  to  be  good.  What  is 
required  is  sufficient  care  and  judgment 
in  placing  the  loans ;  and  so  complete  is 
the  system  applied  by  some  of  the  parties 
that  make  a  business  of  putting  mort- 
gages upon  land,  in  apportioning  their 


FARM  MORTGAGES.  8i 

money  allotments  to  the  market  values  of 
property,  tliat  they  can  be  accepted  with 
even  greater  confidence  than  if  arranged 
by  capitalists  themselves.  Hence  many 
savings-banks  and  other  institutions  of  a 
fiduciary  character,  as  well  as  numerous 
conservative  individual  investors,  have 
put  their  money  into  paper  secured  on 
farming-lands,  and  lands  which  they 
have  never  seen,  and  had  no  opportu- 
nity to  see. 

At  the  same  time  it  must  be  remem- 
bered that,  if  the  strictest  good  faith 
is  not  observed,  there  is  here  a  danger- 
ous opening  for  fraudulent  imposition. 
Should  there  be  collusion  between  the 
loaning  agent  and  the  land-owner,  the 
advance  may  be  in  excess  of  what  is 
justified  by  the  value  of  the  realty,  or 


82  THE  ART  OF  INVESTING. 

the  title  to  tlie  latter  may  be  defective. 
The  surprising  thing  is,  when  the  popu- 
larity of  farm-mortgages  and  the  extent 
to  which  they  have  been  dealt  in  are 
considered,  that  cases  of  deception  have 
not  been  more  numerous.  As  it  is,  they 
have  not  been  wholly  wanting.  The 
writer  once  had  occasion  to  visit  what 
was  called  a  farm,  and  as  such  had  been 
made  the  basis  for  a  loan,  in  one  of  the 
newer  States.  He  found  a  piece  of  prai- 
rie-ground on  which  there  were  signs 
of  occupancy  at  some  considerably  ante- 
rior period  ;  but  which  was  then  deserted, 
and  to  all  intents  and  purposes  mid 
and  waste.  It  was  worth  no  more  than 
land  in  the  same  neighborhood,  on  which 
there  had  been  no  attempt  at  improve- 
ment, and  that  could  be  purchased  for 


FARM  MORTGAGES.  83 

less  to  the  acre  than  the  mortgage  upon 
this  property.  The  owner,  having  se- 
cured such  a  liberal  accommodation 
through  the  carelessness  or  knavery  of 
some  loaning  agent  or  dealer  in  mort- 
gages, had  pocketed  the  money  instead 
of  expending  it  on  his  place,  and  left 
the  ground  for  his  creditor  to  make  the 
most  out  of  that  he  could.  Competi- 
tion among  professional  money-lenders 
in  some  of  the  Western  States  has  be- 
come so  sharp  that  such  cases  are  not 
only  possible  but  probable.  Villages 
away  out  on  the  frontier,  with  scarcely 
sufficient  population  to  make  respect- 
able settlements,  are  often  the  sites  of  in- 
vestment companies — sometimes  of  sev- 
eral of  them — doing  business  under  most 
pretentious  names,  and  offering  amounts 


84  THE  ART  OF  INVESTING. 

of  paper  that,  in  view  of  the  surround- 
ings, are  truly  marvelous.  Nothing 
which,  by  the  most  liberal  interpreta- 
tion, can  be  called  a  farm,  seems  to  es- 
cape them.  The  writer  was  not  sur- 
prised, when  told  by  "one  of  the  na- 
tives "  of  a  border  community,  that 
there  was  not  a  hen-coop  in  his  part 
of  the  country  that  did  not  have  a  mort- 
gage on  it! 

One  of  the  devices  of  these  enter- 
prising companies  is  to  offer  their  own 
guarantees  as  to  both  principal  and  in- 
terest of  all  mortgages  negotiated  by 
them.  It  is  hardly  necessary  to  ask 
what,  in  a  majority  of  cases,  such  in- 
dorsements are  worth.  The  writer 
knows  of  one  company  that  claims  a 
capital  of  only  thirty  thousand  dollars^ 


FARM  MORTGAGES.  85 

and  it  is  doubtful  if  lialf  that  amount 
were  ever  in  its  treasury,  which,  by  its 
own  profession,  has  disposed  of  indorsed 
mortgages  amounting  to  several  million 
dollars.  The  only  safe  policy,  in  buy- 
ing paper  of  this  description,  is  to  deal 
with  parties  of  kno^vn  responsibility  in 
the  business,  and  that  have  reputations 
which  they  will  naturally  be  most  anx- 
ious to  protect.  There  are  a  number 
of  such  concerns,  and  it  is  here  unneces- 
sary to  mention  them.  Some  of  them 
are  individual  operators,  some  business 
firms,  and  some  incorporated  institu- 
tions mth  large  resources  that  make  a 
specialty  in  this  line.  It  would  not 
seem  to  make  much  difference  which 
is  dealt  with,  although  when  the  loans 
have  a  good  while  to  run,  and  the  in- 


86  THE  ART  OF  INVESTING. 

terests  to  be  watched  over  are  at  a  dis- 
tance, prudence  would  suggest,  in  view 
of  tlie  uncertainty  of  human  life  and 
the  many  vicissitudes  that  fortune  has 
in  store,  that  it  would  be  wise  to  deal 
with  parties  having  the  elements  of 
greatest  permanency,  and  which  are 
likely  to  be  corporations. 

It  is  scarcely  necessary  to  add  that, 
in  selecting  investments  of  this  sort, 
there  is  a  choice  apart  from  the  market 
values  upon  which  they  are  secured. 
What  is  wanted  is,  not  merely  safety  as 
to  the  principal  of  the  loan,  but  regular- 
ity in  the  payment  of  interest.  In  sec- 
tions where  only  one  crop  is  depended 
on  by  agriculturists,  such  as  wheat  or 
cotton,  there  is  greater  danger  of  de- 
faults from  natural  causes  than  in  dis- 


FARM  MORTGAGES.  87 

tricts  where  there  is  a  variety  of  produc- 
tions. Then,  there  is  a  drfference  in 
populations.  Some  have  sounder  no- 
tions as  to  financial  obligations  than 
others.  It  is  hardly  to  be  expected  that 
individuals  in  communities  that  repudi- 
ate or  neglect  public  debts,  will  be  shin- 
ing examples  of  personal  integrity.  It 
will  always  be  well  to  give  the  go-by  to 
repudiating  districts.  Apart  from  the 
general  lack  of  sound  business  ethics  in 
such  localities,  there  is  a  reason  why  it 
is  unsafe  to  trust  the  monetary  contracts 
of  their  people,  and  that  is  the  danger 
to  be  apprehended  from  unfriendly  col- 
lection laws.  When  communities  take 
to  fighting  creditors,  they  are  not  likely 
to  confine  their  opposition  to  any  one 
class.      By  means   of  exemption  laws, 


THE  ART  OF  INVESTING. 


stay  laws,  limitation  laws,  assignment 
laws,  etc.,  they  can  make  it  almost  as 
difficult  to  collect  from  individual  debt- 
ors as  from  tlie  public,  and,  as  a  matter 
of  fact,  we  find  legislation  of  tbat  sort 
most  pronounced  wherever  common- 
wealth and  municipal  undertakings  are 
least  respected.  For  instance,  Texas,  in 
selling  her  lands  to  outsiders,  and  then 
converting  them  to  the  uses  of  her  own 
institutions  and  citizens,  as  heretofore 
described,  has  shown  an  utter  disregard 
of  all  moral  obligations,  and  here  it  is 
that  the  laws  have  been  apparently 
made  with  special  reference  to  protect- 
ing local  debtors  from  the  clutch  of  out- 
side creditors.  In  the  most  of  the 
States  a  sealed  instrument  for  the  pay- 
ment of  money  is  good  for  twenty  years. 


FARM  MORTGAGES.  89 

but  in  Texas,  if  not  sued  on  in  four 
years,  it  is  barred  by  "  the  statute  " ;  and 
thousands  of  people  having  claims 
against  Texans,  have  permitted  them  to 
be  lost  through  ignorance  of  that  pecul- 
iar provision.  Again,  in  Texas  a  man 
may  possess  a  great  deal  of  valuable 
property  and  yet  be  execution-proof. 
In  addition  to  "all  provisions  and  for- 
age on  hand  for  home  consumption,"  all 
household  and  kitchen  furniture,  all  im- 
plements of  husbandry,  all  tools  and 
apparatus  used  in  a  trade  or  profession 
actually  followed,  family  portraits  and 
pictures,  a  gun,  two  horses  and  a  wagon, 
a  carriage  or  buggy,  ^yq  milch-cows  and 
calves,  two  yoke  of  work-oxen,  twenty 
hogs,  twenty  head  of  sheep,  all  bridles, 
saddles,  harness,  etc.,  the  debtor  head  of 


90  THE  ART  OF  INVESTING, 

of  a  family  may  liold  a  homestead,  not 
in  a  town  or  city,  of  not  less  than  two 
hundred  acres  of  improved  land,  or  in  a 
city,  town,  or  village,  of  lots  of  the 
value  of  ^N^  thousand  dollars,  "  without 
reference  to  the  value  of  improvements 
thereon,"  and  which,  of  course,  may  be 
worth  much  more  than  the  land.  In 
Texas,  to  get  moieties  under  assignments 
made  for  their  benefit,  creditors  must 
surrender  in  full  their  demands — from 
which  provisions  it  may  not  unreason- 
ably be  inferred  that  Texas  is  a  much 
more  healthy  region  for  debtors  than  for 
creditors.  In  Colorado,  whose  repudia- 
tions have  also  been  referred  to,  a  prom- 
issory note  may  be  '''-  outlawed  "  by  two 
years'  indulgence  on  the  creditor's  part, 
and  a  judgment  of  a  court  of  record  is 


FARM  MORTGAGES.  91 

good  for  three  years  only.  .The  moral 
from  sucli  cases  is  obvious  enough. 
Keep  your  money  out  of  Texas,  Colo- 
rado, and  other  repudiating  sections  if 
you  ever  want  to  see  it  again.  The 
Mgher  rates  of  interest  to  be  obtained 
in  such  localities,  and  which  are  among 
the  penalties  for  their  treatment  of 
those  with  whom  they  have  dealing, 
will  not  compensate  for  the  increased 
risk.  Nor  would  it  be  imprudent  to 
avoid  cities  and  towns  of  tainted  finan- 
cial records,  however  prosperous  they 
may  appear  to  be,  of  which  the  capital 
of  the  State  of  Kansas,  whose  course  is 
elsewhere  considered,  is,  by  reason  of 
its  wealth  and  prominence,  a  notable 
example. 


92  THE  ART  OF  INVESTING. 

Eai^ch  Securities. 

Akin  to  tlie  obligations  just  treated 
of,  because  having  a  basis  in  real  estate, 
and  yet  in  so  many  points  differing 
from  them  as  to  seem  to  call  for  their 
consideration  under  a  different  heading, 
are  securities  predicated  upon  ranch- 
properties.  Cattle-raising,  which,  in  ear- 
lier times,  was  looked  upon  as  a  part 
of  the  farmer's  regular  occupation,  has 
of  late  become  almost  a  separate  indus- 
try, and  grown  to  enormous  propor- 
tions. Ranching,  however,  is  not  con- 
fined to  cattle-production,  as  the  term 
"  cattle  "  is  ordinarily  understood.  We 
now  have  sheep-ranches,  horse-ranches, 
pig-ranches,  goat-ranches,  and  even  os- 
trich- and  goose-ranches.      The  marvel- 


RANCH  SECURITIES,  93 

ous  growth  of  the  rancli  business,  in 
quite  recent  times,  has  had  the  natural 
effect  of  bringing  upon  the  market  a 
class  of  securities  that  has  absorbed,  and 
imfortunately  dissipated,  a  good  deal  of 
investment  capital.  For  a  time  the  busi- 
ness was  remarkably  profitable.  Lands 
in  the  South  and  West,  in  large  bodies, 
were  obtained  at  nominal  figures — often 
by  mere  appropriation — to  operate  them 
as  ranches  cost  but  a  trifle;  for,  as  a 
rule,  neither  houses  nor  fences  were  con- 
structed or  needed;  and  the  prices  of 
cattle,  largely  purchased  for  the  pur- 
pose of  stocking  other  ranches,  were 
high  and  constantly  advancing.  Every- 
body in  the  business  made  money,  or 
seemed  to  be  making  it.  Speculation 
upon  an  extended  scale  was  an  inevita- 


94  THE  ART  OF  INVESTING. 

ble  consequence.  Stock-ranching  com- 
panies— "  stock  "  in  the  corporate  sense 
—  were  soon  being  numerously  or- 
ganized with  the  usual  concomitants 
of  mortgage-bonds  and  share-certificates, 
and,  of  course,  the  public  was  invited 
to  share  in  their  benefits.  Circulars 
that  they  put  forth  told  very  flattering 
tales.  The  lands  which  they  possessed, 
often  little  better  than  desert  wastes, 
were  usually  described  as  worth  from 
^YQ  to  twenty-five  dollars  per  acre ;  their 
cattle  were  estimated  at  the  highest 
market  prices;  and  calculations  were 
gone  into  to  show,  from  the  increase  of 
their  herds  and  the  quantities  of  beef 
and  young  stock  to  be  annually  har- 
vested, that  they  could  not  fail  to  be 
first-class  bonanzas.      The  highest  rates 


RANCH  SECURITIES.  95 

of  interest  and  most  liberal  dividends 
were  promised.  It  is  no  wonder  that 
a  good  many  investors  were  captivated. 

We  all  know  what  the  result  has 
been.  Droughts  in  summer  and  frosts 
in  winter,  for  which  no  allowance  had 
been  made,  and  against  which  no  pre- 
cautions were  taken,  wrought  havoc 
with  the  herds,  and  production  increased 
until  the  ranges  were  overstocked,  and 
prices  went  down  and  down  with  grow- 
ing competition  until  the  end  was  fail- 
ure and  bankruptcy. 

And  yet  it  by  no  means  follows  that 
ranch  securities  will  always  be  worth- 
less. Stock-raising  is  an  entirely  legiti- 
mate calling,  and  will  be  successfully 
prosecuted  on  a  large  scale,  upon  our 
Western  plains  and  prairies,  which  are 


96  THE  ART  OF  INVESTING, 

by  nature  intended  for  tliat  particular 
use.  After  sucb.  arrangements  have 
been  made  for  shelter  and  feed  in  the 
winter,  and  for  water  in  the  summer, 
as  ordinary  prudence  dictates,  and  the 
business  is  brought  to  that  stage  where 
it  will  no  longer  be  conducted  by  "  cat- 
tle-kings "  and  "  cattle-queens  "  as  a  ven- 
ture to  be  decided  by  the  chances  of  the 
weather  and  the  market,  but  by  ordi- 
nary workers,  content  with  moderate 
profits,  and  mindful  of  all  the  oppor- 
tunities and  economies,  ranching  will  be 
a  reasonably  safe  basis  for  money  in- 
vestments of  all  kinds. 

Water- Works  Loans. 
These  are  becoming  very  plentiful — 
how  plentiful  may  be  inferred  from  the 


WATER- WORKS  LOANS.  97 

fact  that  a  directory  of  water- works  for 
towns  and  cities  in  the  United  States, 
recently  issued  by  a  New  York  pub- 
lisher, shows  that  of  over  fourteen  hun- 
dred such  establishments,  the  number 
of  those  owned  and  conducted  by  pri- 
vate (although  incorporated)  companies 
exceeds  those  belonging  to  the  munici- 
palities by  over  one  hundred  and  fifty. 
The  communities  served  by  these  com- 
panies range  from  villages  of  less  than 
two  thousand  population  up  to  a  city  of 
one  hundred  and  twenty-five  thousand 
souls ;  and  the  debts  of  the  companies, 
in  nearly  all  cases  represented  by  coupon 
bonds,  run  from  twenty-five  thousand 
up  to  four  million  dollars.  As  the 
stock  issued  by  the  companies  fully 
equals  their  bonds,  it  will  be  seen  that 


98  THE  ART  OF  INVESTING. 

the  aggregate  of  securities  put  out  by 
tliem  is  very  great. 

The  building  of  water- works  has  be- 
come a  regular  business,  and  has  been 
followed  with  very  satisfactory  results 
by  contracting  parties  that,  in  many 
instances,  are  owners  of  or  interested 
in  the  factories  producing  the  pipes, 
pumps,  and  other  materials  and  machin- 
ery necessarily  used.  The  customary 
method  has  been  to  secure,  in  the  name 
of  an  incorporated  company,  that  is 
merely  a  cover  for  a  professional  builder, 
a  contract  with  a  city  or  village  by 
which  it  is  to  be  supplied  with  water 
for  public  uses — protection  against  fire 
being  the  principal  one — at  a  stipulated 
annual  price,  or  for  so  much  per  hy- 
drant,   with    the    privilege    of    selling 


WATER-WORKS  LOANS.  99 

water  at  specified  rates  to  as  many  pri- 
vate takers  as  can  be  found.  The  con- 
ditions vary,  but  a  supply  of  good, 
wliolesome  water,  in  adequate  quanti- 
ties, is  always  one  of  them.  A  failure 
on  this  point  is  to  invalidate  the  con- 
tract, and  there  may  be  other  grounds 
of  forfeiture. 

For  the  money  with  which  the  works 
are  to  be  constructed,  the  builder  ordi- 
narily depends,  sooner  or  later,  upon 
the  sale  of  bonds.  He  even  expects  to 
have  a  balance  left  from  their  proceeds 
when  the  work  is  done,  and  that,  with 
the  stock  of  the  company,  which  may 
or  may  not  have  a  value,  is  to  be  his 
profit.  The  works,  in  other  words,  are 
relied  upon  to  build  themselves,  and 
pay  the  enterprising  projector  besides, 


loo  THE  ART  OF  INVESTING. 

tliere  being  in  this  respect  no  difference 
as  to  tlie  construction  of  railroads  and 
water  systems. 

Tlie  writer  lias  before  him  a  pam- 
phlet put  out  by  a  dealer  in  invest- 
ments, in  which  water-works  securities 
are  especially  commended.  "  In  no  other 
class  of  mortgages,"  says  the  pamphlet, 
"  can  so  many  and  such  strong  elements 
of  safety  be  found,  since  in  the  whole 
history  of  water-works  there  is  but  one 
known  instance  of  the  foreclosure  of  a 
first  mortgage  (where  the  works  were 
completed  and  in  operation),  and  in  that 
instance  not  a  dollar  of  loss  was  sus- 
tained by  the  bondholders."  While  the 
author  of  the  foregoing  could  not  have 
been  familiar  with  the  case  of  Mem- 
phis, Tennessee,  in  which  the  unfortunate 


WATER-WORKS  LOANS.  loi 

water-works  bondliolders  received  less 
than  twenty  per  cent  of  their  demands 
from  the  proceeds  of  the  foreclosure 
sale,  nor  of  those  of  Galesburg,  Illinois, 
and  other  bankrupt  companies,  there 
are,  nevertheless,  reasons  why  water- 
works mortgage-bonds,  if  issued  under 
proper  conditions,  should  be  among  the 
very  best.  They  are  secured  on  prop- 
erty (underground  pipes,  etc.)  which  is 
but  little  exposed  to  fire  and  accidental 
injuries,  and  the  business  upholding 
them  is  usually  without  competition, 
conducted  wholly  for  cash,  and  in  grow- 
ing communities  must  of  necessity  in- 
crease. But  there  are  perils  and  draw- 
backs. There  is  here,  as  elsewhere,  the 
possibility  of  overbonding.  A  greater 
danger  is   cheap   construction.      In   no 


I02  THE  ART  OF  INVESTING. 

class  of  works,  perhaps,  is  tliere  an  equal 
liability  in  this  direction.  The  most  of 
the  material  used  is  in  pipes  that  are 
buried  and  out  of  sight.  It  is  possible  to 
employ  an  inferior  article,  such  as  sheet- 
iron  instead  of  cast-iron,  which  will  tem- 
porarily answer  the  purpose ;  and  as  the 
builder's  interest  in  the  works,  after 
their  acceptance  by  the  community  with 
which  he  has  contracted — ^usually  not  as 
critical  as  it  should  be — and  the  sale  of 
his  bonds  and  stock,  is  at  an  end,  the 
temptation  besetting  him  is  very  strong. 
Five  or  six  years  is  the  limit  to  the 
probable  use  assigned  by  engineers  to 
pipes  and  other  materials  in  works 
that  the  writer  knows  of,  that  are  cov- 
ered by  mortgages  authorizing  bonds 
having  from  twenty  to  twenty-five  years 


WATER-WORKS  LOANS.  103 

to  run.  If,  at  any  time  before  the 
bonds  mature  and  are  satisfied,  it  is 
found  necessary  to  use  the  funds  needed 
for  principal  or  interest,  in  the  reconstruc- 
tion of  the  property,  it  is  easy  to  see 
how  the  bondholders  may  suffer.  Hence 
to  them  the  very  great  importance  of 
knowing,  before  they  part  with  their 
money,  sundry  points  about  the  security 
they  are  getting,  that  the  most  of  bond- 
purchasers  rarely  think  of  inquiring  into. 
Nor  have  we  reached  an  end  of  the 
risks  attending  this  class  of  securities. 
The  question  of  water-supply  is  always 
of  first  importance.  Water- works  with- 
out water,  and  plenty  of  it,  are,  of 
course,  of  very  little  account.  Now,  it  is 
very  easy  to  understand  how  difficulties 
on  this    score   may   arise  and  increase. 


I04  THE  ART  OF  INVESTING. 

When  works  are  first  constructed,  tliere 
may  be  a  sufficiency  of  water  of  satisfac- 
tory quality  witMn  easy  reach,  and  the 
builder,  anxious  to  get  through  with  his 
work  as  quickly  and  cheaply  as  possible, 
that  he  may  realize  on  it,  will  naturally 
avail  himself  of  such  supply  and  look  no 
further.  But  it  does  not  follow  that  it 
will  always  or  for  a  considerable  time 
be  adequate.  Running  streams  are  usu- 
ally depended  on,  and  everybody  knows 
how  liable  they  are  to  become  corrupted 
in  a  settled  country,  and,  while  the  de- 
mand upon  them  is  increasing  their  vol- 
ume is  likely  to  diminish.  The  writer 
knows  of  more  than  one  company  that 
on  this  point  has  met  with  embarrass- 
ments not  dreamed  of  when  its  opera- 
tions   were    begun.       In    one   instance 


WATER-WORKS  LOANS.  105 

the  cost  of  a  new  water-supply,  made 
necessary  by  tlie  deterioration  of  a  run- 
ning stream,  exceeded  the  entire  origi- 
nal outlay.  The  point  is  one  upon 
which,  in  every  instance,  not  only  are 
contracts  made  especially  stringent,  but 
a  strict  compliance  is  certain  to  be 
demanded.  How  many  of  our  water 
companies  will  be  able  to  meet  their  ob- 
ligations in  this  regard,  during  the  pe- 
riods that  their  bonds  are  issued  for, 
without  the  expenditui^e  of  considerable 
sums  of  money  not  at  first  anticipated  ? 
To  provide  a  fresh  water-supply  may 
prove  a  more  serious  undertaking  even 
than  the  substitution  of  a  new  plant  for 
an  old  one. 

When  securities  founded  upon  water- 
works in  localities  where  they  are  actu- 


io6  THE  ART  OF  INVESTING. 

ally  needed,  and  erected  under  seem- 
ingly favorable  conditions,  are  attended 
witli  sucli  liabilities,  it  will  be  seen  how 
mucli  greater  tlie  danger  must  be  wlien 
the  works  are  located,  by  speculative 
builders,  in  communities  that  do  not 
need  them,  and  of  uncertain  ability  for 
their  support,  purely  as  a  basis  for  the 
manufacture  of  bonds  and  stock.  The 
country  has  been  ransacked  for  water- 
works sites,  and  plenty  of  works  have 
been  built  in  villages  that  the  majority 
of  our  people  have  never  heard  of. 
They  may  grow  and  become  important 
places,  and  they  may  not.  The  obliga- 
tions created  in  such  cases  may  be  valu- 
able, and  they  may  not.  But  it  is  quite 
safe  to  say  that,  if  the  movement  in  this 
direction  continues  and  goes  much  fur- 


STREET-RAILWAY  BONDS,  107 

ther,  the  day  is  not  far  off  wlien  we  will 
be  favored  with  a  plentiful  crop  of  de- 
faults and  water-works  foreclosures. 

StREET-RaILWAY   BoiJTDS. 

Much  that  has  been  said  concerning 
water-works  securities  is  applicable  to 
these.  There  is  not  the  same  opportu- 
nity to  delude  by  the  use  of  inferior 
materials,  since  the  works  are  on  the 
surface ;  but  there  has  been  an  equal  dis- 
position to  push  construction  into  terri- 
tory of  doubtful  earning  capacity.  Many 
roads  have  been  built  where  they  were 
not  needed,  and  where  they  can  not 
pay — at  least,  for  considerable  periods 
to  come ;  and  more  of  that  sort  are  like- 
ly to  be  built.  At  the  same  time,  when 
advantageous    locations   have    been    se- 


io8  THE  ART  OF  INVESTING. 

cured,  witli  francMses  properly  covering 
tlie  ground,  and  particularly  if  exclu- 
sive, few  better  properties  exist,  and 
tlie  securities  based  upon  tliem  can  be 
safely  recommended.  All  tlie  investor 
needs  to  do  is  to  investigate  thoroughly 
before  he  buys.  He  should  satisfy  him- 
self that  the  road  is  in  a  community 
that  is  able  to  sustain  it;  if  in  a  city 
of  known  standing,  that  it  occupies 
streets  likely  to  give  it  permanent  busi- 
ness, and  has  not  been  built  in  remote 
suburbs  or  along  country  highways  as 
a  pretext  for  bond-making ;  that  its 
franchise  is  sufficient  to  protect  it  from 
dangerous  competition;  that  the  securi- 
ties have  been  legally  issued ;  and,  above 
all,  that  there  are  not  too  many  of 
them. 


MISCELLANEOUS  BONDS.  109 

Miscellaneous  Bonds. 
Much,  that  has  been  said  concerning 
water-works  and  street-railway  mort- 
gages is  applicable  to  various  other  se- 
curities, notably  those  of  gas  and  elec- 
tric-light companies.  In  cities  and  vil- 
lages, when  the  latter  are  of  considera- 
ble size,  streets  must  be  lighted,  and  con- 
tracts for  the  purpose  are  always  sought 
by  those  contemplating  the  construction 
of  illuminating-works.  Such,  contracts 
are  usually  for  short  periods,  one  year 
being  the  ordinary  term,  and  for  that 
reason  there  is  greater  danger  from 
competition  than  in  the  matter  of  water- 
supply.  Indeed,  gas  and  electricity  are 
likely  to  be  competitors  in  most  fields 
for   a   considerable   time   to   come,  and 


no  THE  ART  OF  INVESTING. 

the  profits  from  their  operations  must 
be  correspondingly  abridged.  Never- 
theless, many  of  the  securities  predi- 
cated upon  them  should  be  good,  and, 
if  selected  with  care,  can  be  taken  with 
confidence.  Of  course,  there  may  be 
defective  construction  in  material  and 
workmanship,  and  the  buyers  of  gas- 
light and  electric-light  bonds  would  do 
well,  before  parting  with  their  money,  to 
inform  themselves  thoroughly  on  these 
points  as  well  as  others.  In  the  larger 
cities  there  is  less  difficulty  in  estimat- 
ing securities  of  the  kind,  as  they  are 
pretty  certain  to  have  local  quotations 
that  determine  their  values  for  the  time 
being. 

When  it  comes  to  bonds  secured  on 
manufacturing  and  other  private  proper- 


MINING  SECURITIES.  in 


ties,  whicli  may  or  may  not  be  covered 
by  articles  of  incorporation,  no  general 
rule  can  be  laid  down.  Each  interest 
must  be  measured  by  its  own  circum- 
stances, and  investors  can  best  deter- 
mine for  themselves  bow  far  it  is  safe 
to  trust  tbe  promises  it  makes.  The 
markets  in  suck  cases  are  always  more 
or  less  local,  and  those  who  see  fit  to 
put  their  money  into  them  may  be  sup- 
posed to  be  in  possession  of  all  the  facts 
necessary  for  the  formation  of  correct 
judgments. 

Mmma  Secueities. 
The  best  thing  that,  as  a  rule,  can 
be  done  with  these  is  to  let  them  severe- 
ly alone.     There  are  good  mining  shares, 
but  the  average  investor,  who  buys  in- 


112  THE  ART  OF  INVESTING. 

to  such  properties,  does  not  get  that 
kind.  It  is  a  peculiarity  of  the  mining 
business  that  it  pays  only  when  man- 
aged with  exceptional  skill,  and  that 
requires  the  property  to  be  in  the  hands 
of  its  owners.  Of  course,  the  average 
investor  can  not  take  personal  charge 
of  the  mines  into  which  he  buys,  and 
would  not  know  how  to  do  it  properly 
if  he  could.  He  is  compelled  to  intrust 
his  interest  to  the  care  of  hired  agents, 
and,  if  anything  is  settled  in  connection 
with  mining,  it  is  that  about  the  only 
thing  the  ordinary  salaried  mining  su- 
perintendent is  good  for  is  to  draw 
checks  on  his  employers,  and  bury  their 
money  beyond  the  reach  of  resurrection. 


BRIDGE-BONDS.  1 1 3 

BEIDGE-B0I^IDS. 

Wlien  our  larger  streams  are  reached 
by  railways,  and  must  be  crossed  by 
bridges  that  cost  a  great  deal  of  money, 
sucli  structures  have  generally  been 
erected  by  corporations  independent  of 
or  separate  from  the  railroad  companies. 
As  a  general  thing,  being  proximate  to 
large  cities,  they  have  also  been  made 
to  furnish  the  accommodations  of  pub- 
lic highways.  Bonds  and  stocks  issued 
upon  them,  w^hile  subject  to  many  of 
the  same  vicissitudes,  are  quite  as  good 
as  those  of  the  average  of  railroad  com- 
panies. No  general  iiile  can  be  laid 
down  concerning  them.  Each  security 
must  stand  upon  its  own  merits,  as  the 
structure  upon  which  it  is  issued  must 


114  THE  ART  OF  INVESTING. 

stand  upon  its  own  foundations.  There 
should  in  each  case  be  an  investigation 
before  buying.  One  general  caution, 
however,  may  not  be  inappropriate,  and 
that  is,  to  fight  shy  of  the  paper  of  com- 
panies owning  very  expensive  bridges, 
unless  the  ordeal  of  a  reorganization  has 
been  gone  through.  It  is  well  known 
that  the  New  York  and  Brooklyn 
Bridge,  lying  between  the  first  and 
third  cities  in  the  country,  does  not 
begin  to  pay  interest  on  its  cost.  The 
great  St.  Louis  Bridge  failed  for  the 
same  reason,  and  it  is  doubtful  whether 
such  enormous  structures  can  be  erected 
at  outlays  that  will  justify  them  merely 
as  business  ventures  and  investments. 


SUBSTITUTION  SECURITIES,        115 
SuBSTITUTIOiq-    SeCUEITIES. 

Reference  lias  already  been  made  to 
an  ingenious  arrangement  for  issuing 
bonds  upon  the  security  of  other  bonds. 
The  plan  is  comparatively  a  new  one 
in  this  country,  although  something  like 
it  has  long  been  practiced  upon  in  Eng- 
land, and  where  more  than  one  com- 
pany adopting  it  has  come  to  grief 
through  injudicious  investments.  In 
itself  it  is  simple  enough.  Certain  per- 
sons having,  as  they  suppose,  superior 
facilities  for  investigating  securities  of 
one  or  more  kinds,  and  sifting  the  good 
from  the  bad,  organize  with  a  view  to 
purchasing  such  as  they  approve,  and 
on  the  strength  of  which,  when  placed 
with  some  trust  company  or  other  safe 


ii6  THE  ART  OF  INVESTING. 

depository,  they  issue  their  own  bonds 
for  tlie  market  to  tlie  same  amount,  but 
usually  bearing  a  lower  rate  of  interest 
than  those  which  they  own.  The  differ- 
ence in  the  interest  and  the  lower  figures 
at  which  they  may  buy,  compared  with 
those  at  which  they  sell,  make  their 
profits.  To  escape  personal  liability,  and 
possibly  to  establish  a  higher  credit, 
a  corporation  is  formed,  and  the  new 
obligations  are  produced  in  its  name. 

To  such  investors  as  lack  confidence 
in  their  own  judgments,  or  either  do 
not  have  or  prefer  not  to  avail  them- 
selves of  satisfactory  opportunities  for 
investigation  on  their  own  account,  the 
system  undoubtedly  has  recommenda- 
tions. If  securities  were  scarce  and 
hard   to   find,    it    would    be    generally 


SUBSTITUTION  SECURITIES.         117 

popular;  but,  as  long  as  tliey  are  plen- 
tiful, the  majority  of  investors  will  pre- 
fer to  trust  to  their  own  wits  and  save 
tlieir  money.  And,  after  all,  the  judg- 
ment of  one  man  may  be  no  better  than 
that  of  another,  and  those  having  money 
to  dispose  of,  who,  while  relying  upon 
themselves,  exercise  reasonable  prudence, 
will  doubtless,  as  a  rule,  enjoy  the  great- 
est peace  of  mind  and  occupy  positions 
in  many  respects  most  satisfactory. 


CHAPTER  II. 

SPECULATING.'' 

New  Yoek  lias  no  more  entertaining 
public  exhibition  than  its  Stock  Ex- 
change. It  is  one  of  the  show-places  of 
the  city.  The  visitor  who,  for  the  first 
time,  looks  down  from  a  gallery  upon  its 
members  in  the  act  of  transacting  busi- 
ness, is  astonished  at  the  apparent  con- 
fusion he  witnesses.  He  seems  to  have 
entered  a  mad-house.  The  idea  that  the 
market  values  of  our  leading  securities 
should  be  determined  by  what  appears 

*  The  following  chapter  appeared  in  "  The  Forum  " 
for  October,  1886,  under  the  title  of  "  The  Heart  of 
Speculation." 


SPECULATING.  119 

to  him  to  be  a  howling  mob  of  incurable 
lunatics,  is  incomprehensible.  But  if 
nothing  could  be  said  against  the  Ex- 
change, which  is  simply  a  big  bazaar  for 
the  sale  of  bonds  and  stocks,  except  its 
tumultuousness  and  the  seeming  lack  of 
dignity  among  its  operators,  criticism 
would  have  in  it  but  an  indifferent 
target  for  its  shafts.  Much  graver  ques- 
tions grow  out  of  its  existence.  Is  it  a 
harmless  institution?  Is  it  a  public 
blessing?    Is  it  a  public  curse? 

As  a  great  central  mart  for  current 
securities,  it  would  be  unobjectionable. 
There  is  no  reason  why  bonds  and 
shares  should  not  be  publicly  dealt  in, 
and  in  large  quantities,  as  well  as  dry- 
goods;  as  well  as  corn  and  cotton  and 
beef  and  kitchen  vegetables.      If  the 


I20  777^  ART  OF  INVESTING, 

Stock  Excliange  was  intended  for  or  re- 
stricted to  the  hona-fide  buying  and  sell- 
ing of  bonds  and  shares,  not  a  word 
could  be  justly  said  against  it.  But  is 
that  its  business?  Unfortunately,  no. 
Its  chief  occupation  is  wagering  on 
stocks :  its  members,  while  going  through 
the  forms  of  buying  and  selling,  simply 
bet  their  money,  or  somebody  else's 
money,  upon  the  rise  or  fall  of  the 
shares  they  select,  as  they  would  upon 
the  shiftings  of  cards  or  dice.  The  Ex- 
change, while  haying  a  share  of  legiti- 
mate business,  is  chiefly  an  immense 
gambling  establishment. 

Its  members  are  divided  into  two 
classes — those  who  execute  commissions 
for  others,  and  those  who  deal  on  their 
own  account.     It  is  needless  to  say  that 


SPECULATING.  121 

among  tlie  latter  are  tlie  boldest  and 
sharpest  speculators  of  the  day.  The 
careers  of  these  men  can  be  sketched  in 
very  few  words.  Through  the  exercise 
of  superior  native  wits  or  the  accident 
of  extraordinary  luck,  they  flourish  mar- 
velously  for  a  time ;  but  only,  as  a  rule, 
to  lose  their  heads  and  their  balance  at 
last,  and  go  down — often  through  a  sin- 
gle disastrous  transaction — faster  than 
they  went  up.  There  are  exceptions. 
Some  flourish  to  the  end,  dying — gener- 
ally young — or  retiring  with  estates 
unbroken.  But  they  are  exceptions. 
Wall  Street  is  a  place  where  a  few  for- 
tunes are  made  and  a  great  many  are 
lost.  The  stories  of  its  magnificent 
triumphs,  and  of  its  equally  magnificent 

wrecks,  read  like  tales  from  the  "Ara- 
11 


122  THE  ART  OF  INVESTING, 

bian  NigMs";  some  of  tliem  like  pas- 
sages from  Dante's  "Inferno."  Wall 
Street  has  liad  its  suicides  by  tlie  dozen, 
and  it  will  have  plenty  more.  It  would 
not  be  Wall  Street  without  surprises. 
And  yet  there  is  a  singular  sameness  in 
the  ordinary  broker's  experience.  He 
runs  an  exciting,  if  at  times  a  rough  and 
stormy,  career,  snatches  or  seems  to 
snatch  a  good  many  pleasures  by  the 
way,  makes  and  breaks  with  about  equal 
abandon^  wrecks  his  health  in  a  hurry, 
dies  early  and  suddenly,  and  then — well, 
then,  when  his  affairs  come  to  be  settled, 
there  are  found  to  be  large  blocks  of 
utterly  worthless  shares,  perhaps  a  fast 
horse  or  two,  a'  two-wheeled  vehicle  and 
trappings  to  match,  some  costly  souve- 
nirs, and  very  few  solid  assets,  and  the 


SPECULATING,  123 

business  is  closed  in  bankruptcy.  Poor 
fellow,  everybody  has  forgotten  all 
about  liim ! 

Of  the  ordinary  Wall  Street  specula- 
tor, however  clever  or  however  favored 
for  a  time,  it  is  perfectly  safe  to  say 
that,  if  he  lives  long  enough  and  sticks 
to  the  business,  he  will  finally  come  to 
grief. 

But  how  about  Vanderbilt  jpere^  who 
was  more  or  less  of  a  Wall  Street  opera- 
tor all  his  many  days,  and  a  few  other 
not  wholly  dissimilar  if  less  conspicuous 
examples  % 

Ah!  that  brings  us  to  a  view  of 
some  of  the  interior  workings  of  the 
New  York  Stock  Exchange  that  the 
public  has  little  conception  of,  and 
which  alone  will  give  a  correct  under- 


124-  THE  ART  OF  INVESTING. 

standing  of  its  real  cliaracter.  The  pop- 
ular idea  is  that  the  Exchange  has  upon 
its  list,  to  be  dealt  in,  all,  or  nearly  all, 
prominent  stocks  and  bonds  of  acknowl- 
edged value,  impartially  selected  and 
solely  because  of  their  merits.  There 
could  be  no  greater  misconception.  We 
look  there  in  vain  for  the  shares  of  the 
Pennsylvania  Central,  whose  stock  has 
not  a  drop  of  water  in  it ;  of  the  Balti- 
more and  Ohio,  whose  paper,  notwith- 
standing some  mistakes  of  its  managers, 
is  equally  solvent;  of  the  Boston  and 
Providence,  the  Boston  and  Albany,  the 
New  Haven  and  Hartford,  the  Maine 
Central,  and  of  dozens  of  other  corpora- 
tions whose  management  is  unexception- 
able, and  whose  securities  are  among 
the  choicest  investments.     But  if  there 


SPECULATING.  125 

is  a  company  witli  a  speculating  board 
of  clii^ectors,  and  wliose  stock  has  been 
watered  until  it  will  float  a  respectable 
navy,  its  shares  are  pretty  sure  to  be 
found  on  the  Exchansie's  list.  Or  if 
there  is  a  company  that  is  absolutely 
controlled  and  directed  by  some  partic- 
ularly active  and  conspicuous  manipu- 
lator, its  stock  may  be  looked  for  at 
the  same  place.  There  has  never,  ap- 
parently, been  any  difficulty  in  a  big 
stock  operator  getting  his  issues  upon 
the  list.  What  has  been  the  result? 
Simply  that  the  most  abominable  rub- 
bish has  been  unloaded  upon  the 
public. 

Much,  but  not  too  much,  has  been 
said  in  condemnation  of  stock- watering ; 
of  the  production   of  corporate   certifi- 


126  THE  ART  OF  INVESTING, 

cates  representing  little  or  no  casli  in- 
vestment, and  wHcli  innocent  persons  are 
led  to  purchase  in  tlie  belief  tliat  they 
are  getting  full  values.  But  how  is  it 
that  these  fraudulent  issues  can  be  mar- 
keted, and  the  producers  escape  legal  re- 
sponsibility for  the  impositions  prac- 
ticed? Here  is  where  the  Exchange's 
work  comes  in.  The  Exchange  is  the 
conduit  through  which  the  water  is 
safely  carried  into  the  investors'  pock- 
ets. When  it  takes  the  stock  upon  its 
list,  the  Exchange  becomes  practically 
the  seller,  supplying  the  machinery  and 
the  means  of  transfer,  and  it  guarantees 
nothing.  Whoever  buys  at  its  board  is 
understood  to  take  all  risks,  no  matter 
how  much  deception  is  used.  He  may 
be  utterly  victimized — often  is  so — but 


SPECULA  TING,  1 27 

he  has  no  redress.  Here  is  the  medium 
through  which  the  over-issues  have  been 
marketed.  But  for  the  Exchange's  in- 
strumentality, the  facilities  it  has  fur- 
nished, those  stupendous  stock-watering 
frauds  which  have  become  historical 
never  could  have  been  successfully  con- 
summated. 

Once  on  the  Exchange's  list,  there 
has  never  yet  been  a  stock  so  worthless 
that,  with  a  shrewd  manipulator  behind 
it,  it  could  not  be  unloaded.  The  pro- 
cess has  been  a  simple  one :  First,  there 
are  "washed" — singular  how  the  idea 
of  water  runs  through  all  stock  opera- 
tions— or  prearranged  sales  of  the  stock. 
Outsiders  are  then  told  that  there  is 
money  in  it,  and  they  begin  to  buy.  The 
stock  is  duly  "  supported  " — an  indispen- 


128  THE  ART  OF  INVESTING. 

sable  precaution — that  is,  it  is  taken  at 
quotation  prices  when  offered  by  outside 
owners,  and  so  up  and  up  it  is  marked, 
tke  speculative  public  taking  large 
blocks  in  the  belief  that  it  is  going 
bigker,  and  with  little  thought  of  its 
actual  value,  until  there  comes  a  time 
when,  the  original  supply  being  ex- 
hausted, the  shares  are  no  longer  sup- 
ported, and  down,  down  they  go.  The 
real  value  of  the  stock  has  little  to  do 
with  its  negotiation.  In  the  light  of 
that  explanation,  there  is  no  difficulty  in 
comprehending  how  certain  great  rail- 
road magnates,  who  are  leading  opera- 
tors in  Wall  street,  have  amassed  such  co- 
lossal fortunes.  They  have  been  stock- 
manufacturers  as  well  as  stock-dealers. 
The  New  York  Exchange  has  been  their 


SPECULATING.  129 

field  of  operations — their  market-place. 
Througli  it  they  have  sold  their  wares. 
Had  they,  like  ordinary  speculators,  con- 
fined themselves  to  other  people's  goods, 
it  is  questionable  whether  they  would 
have  grown  exceptionably  rich.  They 
might  have  become  poor,  as  the  most  of 
their  associates  have  done.  But  when, 
with  consciences  conformable  to  their 
opportunities,  they  had  the  means  of 
selling  water  at  high  figures  and  in  prac- 
tically unlimited  quantities,  it  is  no  won- 
der that  their  fortunes  swelled  to  fabu- 
lous proportions. 

A  glance  at  the  Exchange's  list  tells 
the  whole  disgraceful  story.  What  a 
column  of  tatterdemalions  it  parades  !  It 
looks  as  if,  in  making  up  its  assortment, 
the  listing  committee  had  gone  into  the 


I30  THE  ART  OF  INVESTING. 

highways  and  by-ways,  with  orders  to 
bring  in  the  lame,  the  halt,  and  the  blind. 
Wabash  is  there,  Denver  and  Kio  Grande 
is  there,  Hocking  Valley  is  there,  Texas 
and  Pacific  is  there,  Bloomington  and 
Western  is  there,  Nickel  Plate  is  there. 
West  Shore  is  there,  the  whole  noble 
army  of  frauds  that  once  flourished 
so  magnificently  and  bled  the  public  so 
profusely,  is  there.  Consolidated  Gas, 
with  thirty-five  millions  of  stock  that, 
from  official  investigation,  would  appear 
to  have  been  evolved  from  a  cash  invest- 
ment of  less  than  twelve  millions,  is 
there,  of  course.  It  is  a  new  accession, 
and  shows  how  naturally  inflated  and 
adulterated  securities  seek  the  Ex- 
change's forum,  and  how  readily  they 
are  admitted.     The  Exchange  has  a  com- 


SPECULATING.  131 

mittee  to  pass  upon  applications  for  list- 
ing, and  whicli,  in  theory,  excludes  un- 
worthy issues.  It  is  supposed  to  act  as 
a  sieve  ;  but  certain  it  is  that,  sieve-like, 
it  is  no  obstruction  to  the  passage  of 
water. 

While  its  bond-list,  as  a  whole,  is 
much  more  respectable  than  its  stock- 
list,  it  is  noteworthy  that  the  Exchange's 
dealings  are  principally  in  the  specula- 
tive issues — ^the  second  and  third  mort- 
gages, the  incomes,  the  land-grants,  and 
other  junior  or  discredited  securities. 
These  are  the  driftwood  of  the  market, 
which  nobody  buys  to  keep,  because, 
yielding  little  or  no  income,  they  are  of 
no  account  as  investments ;  and  they  are 
bid  up  or  bid  down,  according  to  the 
course  of  speculation  at  the  time.    When 


132  THE  ART  OF  INVESTING, 

actual  investors  wisli  to  buy,  as  a  rule 
they  go  to  bankers  and  dealers  wlio 
have  nothing  to  do  with  the  Exchange 
and  pay  very  little  attention  to  its  quo- 
tations. 

Oh,  how  gayly  the  business  of  mak- 
ing and  marketing  securities  was  but  re- 
cently going  forward  in  "Wall  Street! 
The  inflation  period  that  followed  the 
depression  from  1873  to  1879  was  the 
golden  era  of  stock  speculation.  The 
Exchange  fairly  rioted  in  profitable  traf- 
fic. The  public  was  supposed  to  be  cry- 
ing for  shares,  and  the  magnates  of  that 
institution  were  doing  their  best  to  meet 
the  demand.  They  succeeded  pretty 
well.  Some  of  them  built  new  roads 
and  stocked  and  bonded  them  for  only 
four  or    five    times    theii^    actual    cost. 


SPECULATING.  133 

They  souglit  strange  fields  for  tlieir  vent- 
ures— in  tlie  wilderness,  upon  tlie  des- 
ert plains,  among  the  mountain-peaks. 
They  overleaped  the  national  boundaries 
and  rushed  pell-mell  into  Mexico;  and 
when  all  available  openings  were  filled, 
they  entered  upon  the  work  of  "paral- 
leling " — constructing  new  roads  by  the 
sides  of  old  ones.  The  purpose  of  it 
all  was  the  production  of  paper  to  be 
dealt  in  "  at  the  board."  It  was  bonds, 
bonds,  bonds ;  stock,  stock,  stock ;  wa- 
ter, water,  water.  Millions  upon  mill- 
ions of  so-called  securities  were  manu- 
factured, costing  little  more  than  the 
blank  paper  upon  which  they  were 
stamped  and  the  mechanical  labor  be- 
stowed upon  it,  and  dumped  into  the 
hopper  of  the  Exchange,  to  be   by   it 


134  THE  ART  OF  INVESTING, 

stirred  up  and  turned  over  a  few  times, 
and  tlien  systematically  worked  off  on 
tlie  great  investing  public. 

Very  well  does  tlie  writer,  as  well  as 
a  good  many  others,  remember  what  it 
all  came  to;  how  on  a  bright  day  of 
May,  of  the  year  1884,  pandemonium,  in 
the  form  of  a  panic,  entered  Wall  Street ; 
how  the  great  throngs  that  gathered 
there  and  filled  all  available  spaces 
surged  and  seethed  like  troubled  waters ; 
how  great  bankers  and  leading  busi- 
ness men  ran  wild-eyed  and  bareheaded 
through  the  streets ;  how  mobs  of  half- 
demented  people  crowded  round  broker- 
age-houses, richly -dressed  women  and 
gray-haired  men  among  them,  weeping 
and  wringing  their  hands;  how  sur- 
rounding the  doors  of  suspected  banks 


SPECULATING.  135 

were  groups  of  idlers  who,  witli  tlie  true 
instinct  of  Wall  Street  denizens,  were 
betting  tlieir  money  on  tlie  length  of 
time  their  doors  would  remain  open; 
how  about  the  remorseless  "tickers" 
in  brokers'  shops  were  gathered  crowds 
of  excited  men,  tremblingly  watching 
the  course  of  stocks  that  seemed  to  be 
going  down,  down  to  perdition,  the  wa- 
ter they  contained  suddenly  turning  to 
hydraulic  pressure  to  crush  them.  Those 
who  saw  that  spectacle  in  all  its  grim 
and  terrible  seriousness  will  witness 
nothing  to  match  it  this  side  of  the  "  In- 
ferno." Ah !  the  New  York  Stock  Ex- 
change then  gave  its  patrons  a  treat 
many  of  them  will  not  soon  forget. 

But  the  Exchange,  with  all  its  short- 
comings, is  at  least  useful  if  not  neces- 


136  THE  ART  OF  INVESTING, 

saiy  in  supplying  quotable  values  and 
giving  stability  and  tone  to  tlie  business 
of  tlie  country.  Is  it  ?  Let  us  see.  On 
tlie  1st  of  March,  1884,  Delaware,  Lack- 
awanna and  Western  stock  sold  on  the 
board  at  133^.  In  January  following  it 
brought  at  the  same  place  only  82f. 
The  next  December  it  was  up  to  129f. 
"Lackawanna"  is  an  old,  conservative 
company,  lightly  capitalized,  with  an  es- 
tablished business;  a  regular,  uniform 
dividend-payer.  Intrinsically  the  value 
of  its  shares  has  not  varied  in  the  past 
five  years.  "  St.  Paul "  is  another  stock 
that,  apart  from  speculation,  should  not 
change.  Yet  in  1883  it  sold  "on 
'Change"  as  high  as  108 J,  in  1884  down 
to  58J-,  and  in  1885  was  back  to  within 
one  per  cent  of  par.     In  one  half  hour 


SPECULATING.  137 

during  the  May  panic  of  1884  the  se- 
curities on  tlie  Exchange's  list  shrank  in 
quotations  over  $100,000,000;  in  one 
day  nearly  $300,000,000.  Not  much 
stability,  not  much  reliability  there! 
Either  prices  had  been  much  too  high 
or  they  went  much  too  low.  The  Ex- 
change in  the  one  case  or  the  other,  if 
not  in  both,  failed  to  hold  them  at  the 
proper  level.  Nor  in  this  is  there  any- 
thing remarkable.  Wide  and  sudden 
fluctuations  are  necessary  results  of  the 
Exchange's  methods.  Its  members  are 
supposed  to  be  divided  between  "  bulls" 
and  "  bears  " — those  who  try  to  advance 
prices  and  those  who  try  to  depress 
them ;  but  all  are  as  likely  as  not  at  one 
time  to  be  bulls  and  at  another  bears. 
They  have  their  stampedes.     No  drove 


138  THE  ART  OF  INVESTING, 

of  cattle  upon  tlie  Western  prairie  is 
more  subject  to  sudden  scares  and  er- 
ratic ruslies  than  they  are.  Indeed,  a 
wild  herd  of  steers,  with  horns  uplifted 
and  tails  in  the  air,  charging  across  the 
plain,  would  give  but  a  faint  idea  of  the 
flurries  and  scurries  of  Wall  Street  bulls 
and  bears  in  the  midst  of  a  round-up. 
When  the  market  looks  like  going  up,  all 
hands  are  ready  to  lift  it  higher.  When 
going  down,  all  are  ready  to  ride  it  to 
the  bottom.  The  result  is,  a  succession 
of  extremes ;  and  even  when  the  entire 
Exchange  is  not  blindly  swayed  to  one 
side  or  the  other,  nothing  is  more  com- 
mon among  its  operators  than  the  for- 
mation of  pools  to  advance  particular 
stocks  or  of  combinations  to  raid  others, 
artificial  agencies  in   both  cases  being 


SPECULATING,  139 

freely  used.  How  often,  or  rather  how 
seldom,  do  Exchange  quotations  express 
the  values  that  stocks  would  have  if  left 
to  themselves  or  to  the  arbitrament  of 
supply  and  demand! 

In  these  things,  as  already  said,  to 
one  familiar  with  Wall  Street  ways, 
there  is  nothing  remarkable.  It  is 
upon  fluctuations  that  stock  speculation 
fattens.  The  delight  of  the  regular 
Wall  Street  man  is  a  wild  market — 
the  wilder  the  better.  Quick  changes 
bring  him  quick  profits.  He  knows 
that  a  steady  market  means  a  dull 
market,  and  nothing  does  he  more 
heartily  detest.  To  him  the  most  agree- 
able of  all  movements  is  that  which 
sends  up  prices  with  a  rush  and  a  hur- 
rah, creating  what,  in  Wall  Street  par- 


I40  777^  ART  OF  INVESTING. 

lance,  is  known  as  a  "  boom,"  and  lead- 
ing outsiders  to  purchase  on  the  rise — 
of  course,  in  tlie  expectation  of  higher 
figures — and  which  then  lets  prices  drop 
so  suddenly  as  to  shake  or  scare  these 
purchasers  out.  In  that  way  the  broker  - 
gets  both  the  money  and  the  stocks, 
and  the  outsider  gets  a  lesson.  It  is 
the  theory  of  experienced  operators,  and 
undoubtedly  a  correct  one,  that  the  out- 
side speculator  rarely  comes  into  the 
market  until  prices  are  up,  and  he  can 
look  back  and  see  what  he  has  lost  by 
not  venturing  earlier;  and  is  never  so 
ready  to  sell  as  when  prices  are  down, 
and  he  can  look  back  and  see  what  he 
has  lost  by  not  getting  out  sooner. 

Instead  of  being  a  balance-wheel  to 
the  business  of  the  country,  the  Stock 


SPECULATING.  141 

Exchange  is  far  more  likely  to  be  a  dis- 
turbing factor.  It  does  not  even  fur- 
nisli  trustworthy  news.  Nowhere  is  it 
so  difficult  to  get  reliable  intelligence 
concerning  any  stock  dealt  in  there,  as 
in  Wall  Street.  The  inventiveness  of 
the  speculative  broker  is  something 
marvelous.  He  can  ruin  the  country 
one  hour  and  save  it  the  next.  He 
can  blight  the  crops  of  a  whole  section, 
or  he  can  fill  the  land  with  abundance. 
He  can  make  war  or  he  can  make  peace, 
exactly  as  his  momentary  interest  de- 
mands. Rumor-mongering  seems  to  be 
a  part  of  his  trade.  He  is  the  chief  of 
liars.  Perhaps  he  is  the  exception 
rather  than  the  rule  among  his  fellows 
— ^it  is  to  be  hoped  that  he  is — ^but  he  is 
a  pretty  numerous  exception,  for  all  that ! 


142  THE  ART  OF  INVESTING, 

What  is  tlie  consequence?  Simply 
that  when  a  financial  storm  threatens 
the  country,  the  Exchange  is  almost  cer- 
tain to  be  the  center  of  disturbance. 
No  other  institution  is  so  sensitive.  It 
exaggerates  all  the  symptoms  of  trouble. 
It  sends  out  its  alarming  reports  as  the 
storm-cloud  sends  out  its  lightnings. 
Looking  at  it  as  the  barometer  of  values, 
the  timid  naturally  conclude  that  every- 
thing is  lost,  and  thus  the  evil  is  unduly 
magnified.  Wall  Street  is  as  much  the 
natural  field  for  panics  as  the  prairie  is 
for  tornadoes. 

If  the  Exchange  has  been  of  advan- 
tage to  the  business  interests  of  the 
country,  those  who  have  had  dealings 
with  it  should  be  ready  to  testify  in  its 
favor.     Of  the  thousands  and  thousands 


SPECULATING.  143 

who  have  visited  it  in  person  or  by 
proxy,  and  done  a  little  business  with 
it,  how  many  are  ready  to  rise  up  and 
call  it  blessed,  except  in  a  very  quali- 
fied sense  ?  If  all  were  to  give  their 
experiences,  what  would  the  verdict  be  ? 
It  is  to  be  apprehended  that  the  evi- 
dence of  a  very  decided  majority  would 
not  be  flattering  to  Wall  Street's  famous 
institution;  that  their  testimony  would 
be  that  they  had  found  it  easier  to  lose 
money  there  than  to  make  it. 

But  why  mince  matters  ?  Why  deal 
in  doubtful  phrases  ?  Why  not  at  once 
declare  what  the  discussion  of  the  sub- 
ject inevitably  leads  to — viz.,  that  the 
New  York  Stock  Exchange,  which  is 
the  soul,  the  motive  power  of  Wall 
Street,  is  an  evil  in  the  land,  a  danger 


144  THE  ART  OF  INVESTING. 

to  private  wealth,  a  disturbing  force  in 
general  business,  and  a  foe  to  public 
morals.  A  not  overdrawn  description 
would  picture  it  as  an  enormous  devil- 
fisli  witli  a  hundred  thousand  arms 
reaching  into  all  parts  of  the  country, 
and  all  equipped  with  suckers  more  or 
less  powerful,  and  busy  every  one  of 
them,  in  extracting  nourishment  for 
the  monster  to  which  it  belongs.  The 
trouble  is  that  its  tentacles  are  rarely 
seen.  They  work  in  the  dark ;  they  have 
the  gift  of  invisibility.  But,  oh,  how 
many  victims  they  have  crushed !  Yon- 
der is  a  bank  that  is  supposed  to  be  as 
solid  as  the  hills.  Rich  and  poor  make 
it  the  depository  of  their  surpluses.  It 
enjoys  the  confidence  of  all.  But  in  an 
evil  hour  one  of  the  arms  of  the  Wall 


SPECULATING.  145 

Street  octopus  lias  fastened  itself  upon 
it  and  penetrated  to  its  safe,  and  pretty 
soon  its  president,  or  its  cashier,  or  its 
managing  director,  will  be  gone — gone 
to  Canada  —  and  the  bank  will  be 
wrecked.  There  is  a  citizen  who  has 
the  respect  of  all.  He  is  a  good  man, 
useful  in  his  community,  and  the  strong- 
hold of  his  family  and  his  friends.  But, 
somehow,  he  is  caught  in  the  deadly 
embrace,  and  soon  he  w^ill  be  a  bank- 
rupt and  a  defaulter,  if  not  a  suicide. 
Such  cases,  by  their  frequency,  have 
almost  ceased  to  surprise ;  and  yet  they 
represent  but  a  small  portion  of  the 
losses  actually  wrought.  Most  of  the 
injuries  inflicted  by  stock-gambling  are 
unknown,  except  to  the  sufferers.  Wall 
Street's  victims,  as  a  rule,  do  not  expose 

13 


146  THE  ART  OF  INVESTING. 

tLeir  wounds  unless  they  are  mortal. 
Tlie  aggregate  tax  upon  tlie  country  for 
tlie  support  of  its  operations  is  some- 
thing enormous.  It  can  not  be  other- 
wise when  we  see  how  Wall  Street  lives 
and  flourishes.  It  maintains  a  good- 
sized  army  of  operators,  the  member- 
ship of  the  Stock  Exchange  numbering 
nearly  twelve  hundred — without  count- 
ing "  curbstone "  men  and  other  camp- 
followers — who  spend  with  the  lavish- 
ness  of  soldiers  of  fortune,  while  some 
of  them  take  unparalleled  fortunes  out 
of  the  street.  And  yet  Wall  Street 
does  not  produce  a  dollar.  It  creates 
nothing.  It  draws  its  sustenance  en- 
tirely from  outsiders.  It  is  a  blood- 
sucker. 

That   Wall   Street   should  continue 


SPECULATING.  147 

to  attract  fresh  patrons  and  victims, 
in  view  of  the  numerous  warnings  they 
have  received,  would  be  unaccountable 
were  it  not  for  that  feverish  desire  for 
sudden  riches  which  pervades  the  whole 
country,  and  which  "the  street"  has 
been  mainly  instrumental  in  producing. 
It  is  said  of  the  cuttle-fish  that  it  dis- 
charges a  fluid  which  darkens  the 
water  all  about  it,  and  so  blinds  its 
prey  that  they  are  helpless  against  its 
attacks.  The  Wall  Street  monster — 
the  comparison  still  holds  good — ^by 
the  example  of  its  few  conspicuous  suc- 
cesses and  its  general  demoralization, 
so  impregnates  the  atmosphere  of  the 
whole  country  with  the  speculative 
mania,  that  thousands  and  thousands 
can  not  resist  it.     There  is  no  village  so 


148  THE  ART  OF  INVESTING. 

small  or  so  remote  tliat  it  may  not  have 
its  local  speculator.  No  calling  or  pro- 
fession escapes  tlie  contagion.  Tlie  ac- 
commodations for  all  are  ample.  Wall 
Street  lias  its  wire  connections  with  all 
points,  and  there  are  plenty  of  middle- 
men to  instruct  the  uninitiated  and 
take  their  orders  for  stocks.  The  "mar- 
gin "  feature  is  the  cleverest  bait.  The 
fact  that,  by  putting  up  one  thousand 
dollars  in  cash,  you  can  buy  or  sell  from 
ten  to  twenty  thousand  dollars  in  stocks, 
and  take  a  profit  on  the  larger  amount, 
is  to  many  an  irresistible  temptation. 
Then,  in  theory,  it  is  so  easy  to  win  by 
speculation!  To  buy  at  a  low  figure 
and  sell  at  a  higher,  or  to  sell  at  a  high 
figure  and  afterward  buy  at  a  lower, 
seems  such  a  simple  operation !     It  al- 


SPECULATING.  149 

most  looks  as  if  you  could  go  into  Wall 
Street  and  pick  up  money  from  tke  side- 
walks. Those  wlio  have  made  tke  at- 
tempt, however,  liave  found  tlie  practice 
very  different  from  tlie  theory.  When 
the  cleverest  operators,  the  trained  Tia- 
bitues  of  the  street,  so  often  make  ship- 
wreck, what  hope  is  there  for  the  inex- 
perienced ?  A  loss,  however,  is  usually 
incurred  before  the  real  difficulties  of 
the  situation  are  realized,  and  then,  in 
nine  cases  in  ten,  there  exists  on  the 
part  of  speculators,  out  of  sheer  despera- 
tion or  from  the  fascination  that  attends 
the  game,  the  determination  to  try  an- 
other chance,  and  in  that  way  good 
money  is  thrown  after  bad  until  ruin  is 
reached.  It  is  folly  to  charge  upon 
Wall  Street  sharpers  the  seduction  of 


ISO  THE  ART  OF  INVESTING. 

sucIl  men.  They  lose  because  they 
want  to  make  money,  are  not  particular 
how  they  make  it,  and  flatter  themselves 
that  they  are  sharp  enough  to  win  where 
others  have  failed.  They  are  their  own 
victims. 

And  yet  they  are  not  the  only  suf- 
ferers, and  possibly  not  the  greatest. 
The  man  who  wins  somebody  else's 
money  in  Wall  Street  is  far  more  than 
likely  to  lose  it,  and  more  with  it,  at  the 
next  venture  he  makes.  And  even  the 
few  so-called  lucky  ones  who  retire  with 
their  winnings,  are  not  under  all  cir- 
cumstances to  be  envied.  The  triumph 
of  the  man  who  victimizes  the  public 
with  watered  stocks,  which  are  no  better 
than  adulterated  wares  or  counterfeited 
coin,  is  not  without  alloy.     He  may  re- 


*   SPECULATING.  151 

joice  in  tlie  money,  and  in  tlie  fleeting 
importance  it  gives  him,  but  lie  knows 
how  lie  got  his  wealth,  and  he  knows 
that  others  know  how  he  got  it.  The 
sensitiveness  of  pride  remains,  even  if 
conscience  be  dead. 

But  while  the  writer  does  not  hesi- 
tate to  arraign  the  ISTew  York  Exchange, 
being  the  acknowledged  center  of  stock 
speculation  in  the  country,  as  an  enemy 
to  public  morals  and  general  business, 
he  admits  that  it  is  not  the  only  culprit 
of  the  kind.  The  Produce  Exchange — 
or  Board  of  Trade,  as  it  is  called — of 
Chicago,  is  a  den  of  speculators,  whose 
operations  are  even  more  pernicious. 
They  affect  more  far-reaching  interests. 
Stocks  and  bonds  are  in  comparatively 
few  hands,  and  these  are  generally  strong 


152  THE  ART  OF  INVESTING. 

enough  to  withstand  ordinary  fluctua- 
tions. But  the  produce-gambler  deals 
with  men's  necessities,  he  juggles  with 
the  staff  of  life.  The  soil- worker,  who 
takes  no  part  in  the  gamester's  opera- 
tions, and  is  in  no  wise  responsible  for 
them,  is  liable  at  any  time  to  be  robbed 
of  his  just  rewards  through  their  deals 
and  pools;  and  the  mechanic  or  other 
wage-earner,  who  is  equally  innocent  of 
complicity  with  them,  is  compelled  to 
pay  them  tribute  on  every  loaf  of  bread 
and  every  cut  of  beef  or  pork  he  puts 
into  his  own  or  his  children's  mouths. 
Of  all  kinds  of  speculative  gambling, 
that  in  breadstuffs  and  meats  is  the  low- 
est, the  meanest.  The  same  comment, 
differing  in  degree  only,  will  apply  to 
such  institutions  as  the  Petroleum  Board 


SPECULATING.  153 

of  Pittsburg.  Indeed,  it  runs  tlie  whole 
gamut  of  the  speculative  "exchanges" 
and  "  boards,"  from  the  highest  down  to 
the  petit-larceny  bucket-shop  where,  with 
a  ten-dollar  bill,  you  can  purchase  a 
chance  on  stocks,  or  oil,  or  wheat,  or 
pork,  or  anything  else  that  men  gamble 
in.  All  are  members  of  one  family,  and 
should  be  reo-arded  and  treated  alike. 


APPENDIX. 


INVESTMENT  SECURITIES, 

Ant  one  having  a  negotiable  security  is 
naturally  anxious  to  know  its  market  value ; 
especially  so  if  looking  for  a  purchaser.  If 
the  security  happens  to  be  listed  at  a  stock- 
exchange,  it  is  an  easy  matter  to  get  a  quota- 
tion on  it,  and  a  buyer  can  generally  be  found 
at  some  price.  Or,  if  looking  for  a  not  very 
common  security,  any  one  may  possibly  be 
aided  in  his  search  by  reference  to  the  same 
quarter.  Few,  however,  outside  of  profession- 
al bond  and  share  dealers,  are  familiar  with 
the  transactions  of  the  exchanges,  and  it  is 
probable  that  a  preponderance  of  the  securi- 
ties dealt  in  at  their  boards  are  in  the  hands 
of  people  ignorant  of  the  positions  they  oc- 
cupy. To  such  parties,  as  well  as  to  those 
who  may  be  in  quest  of  particular  bonds  or 
shares,  without  knowing  exactly  where  to  look 


56  APPENDIX. 


for  them,  and  what  their  acquisition  will  cost, 
the  following  transcripts  from  the  books  of 
our  principal  exchanges,  and  showing  the  range 
of  their  operations,  will  be  of  interest,  and 
sometimes  of  advantage. 

It  will  be  seen  that,  beyond  giving,  to  some 
extent,  a  preference  to  obligations  that  happen 
to  be  strictly  local  or  most  generally  held  in 
the  neighborhood,  no  positive  rule  of  selection 
has  been  observed  in  making  up  the  lists.  The 
good  and  the  bad  are  mingled  in  a  way  that  is 
quite  indiscriminate,  and  which  to  the  casual 
observer  must  be  somewhat  bewildering.  To 
any  one,  however,  who  has  read  the  accom- 
panying chapters  there  will  be  no  particular 
mystery  about  it.  Indeed,  it  is  partly  to  illus- 
trate the  points  therein  made  that  the  follow- 
ing record  is  given. 

As  prices  bid  or  paid  are  constantly  fluctu- 
ating, there  is  no  use  in  giving  present  or 
recent  figures ;  but  any  one  interested  in  any 
of  the  securities  on  the  lists  can  easily  inform 
himself  by  applying  to  the  proper  quarter  or 
quarters. 


INVESTMENT  SECURITIES.  157 

NEW  YORK   STOCK-EXCHANGE. 

Government  Securities. 

Amount. 

U.S.4K,  registered  1891 [244,251,000 

43^,  coupon       1891 S 

4;s,  registered  1907 1  737,812,800 

4  s,  coupon   1907 S 

6's,  currency  1895 3,002,000 

6's,    "     1896 8,000,000 

6's,    "     1897 9,712,000 

6's,         "  1898 29,904,952 

6's,         "  1899 14,004,560 

State  Securities. 

Alabama,  Class  A,  3  to  5 1906,  6,728,800 

Class  B,  5's 1906,  539,000 

Class  C,  4's 1906,  959,000 

6's,  10-20 1900,  960,000 

Arkansas  6's,  Funded 1899-1900,  3,000,000 

7's,  Little  Rock  &  Fort  Smith. . .  1,000,000 

7's,  Memphis  &  Little  Rock 1,200,000 

7's,  Lit.  Rock,  Pine  Bl.  &  K  0..  1,200,000 

7's,  Miss.,  Ouachita  &  Red  Riv..  600,000 

7's,  Arkansas  Central 1,350,000 

Georgia  7's,  gold  bonds 1890,  2,000,000 

Louisiana  7's,  consolidated 1914,  \ 

7's,  consolidated,  stamped  4's (•  12,039,000 

7's,  consolidated,  small  bonds ) 

Michigan  7's 1890,  231,000 

Missouri  6's,  due 1887,  3,242,000 

6's,  due 1888,  3,251,000 

6's,  due 1889  or  1890,  1,105,000 


158 


APPENDIX, 


Missouri  Asylum  or  University,  due.  .1892, 

Funding  bonds,  due 1894-'95, 

Hannibal  &  St.  Joseph,  due  1887, 

New  York  6's,  gold  registered 1887, 

6's,  coupon 1887, 

6's,  loan 1891, 

6's,  loan 1892, 

6's,  loan 1893, 

North  Carolina  6's,  old 1886-'98, 

April  and  October 

to  N.  C.  R.  R.,  1883-'4^'5, 

7  coupons  off 

April  and  October 

7  coupons  off 

Funding  act . . .  1866-1900, 
Funding  act. .  .1868-1898, 
New  b'ds,  J.  &  J.  .1892-'98, 
New  b'ds,  J.  &  J.,  A.  &  0., 

Chatham  Railroad 

Special  tax,  Class  1 

Special  tax.  Class  2 

Special  tax,  to  W'n  N.  C.  R. 
Special  tax.  Western  R.  R. 
Special  tax,  Wil.  C.  &  Ru.  R. 
Special  tax,  W'n  &  Tar.  R. 

Trust  certificates 

Consolidated  4's 1910, 

Consolidated  small. . . 

6's 1919, 

Rhode  Island  6's,  coupon 1893-'94, 

South  Carolina  6's,  Act  March  23,  1869, 

non-fundable 1888, 

Brown  consol'n  6's. . .  1893, 


Amount. 

401,000 
1,000,000 
1,000,000 

942,000 

643,200 
4,302,600 
2,000,000 

473,000 
4,738,000 
3,639,400 

3,000,000 

2,417,000 
1,721,400 
2,383,000 
495,000 
1,200,000 


11,360,000 


3,620,311 

2,593,000 
1,372,000 

5,965,000 
4,280,000 


INVESTMENT  SECURITIES. 


Amount. 

Tennessee  6's,  old 1890-'^'8,  ^ 

6's,  new  bonds. . .  .1892-'8-1900,  V  4,397,000 
6's,  new  bonds,  new  series..  1914>  ) 

Compromise,  3^U5-6's 1912,  2,014,000 

New  settlement,  6's 1913,  827,000 

Small  bonds 51,600 

New  settlement,  5's 1913,  349,000 

Small  bonds 10,300 

New  settlement,  3's 1913,  10,743,000 

Small  bonds 350,000 

Virginia  6's,  old 9,427,000 

6's,  new  bonds 1866,  700,000 

6's,  new  bonds 1867,  466,000 

6's,  consol.  bonds 20,239,000 

6's,  consol.  second  series 2,442,784 

6's,  deferred  bonds )  ^n  gg-i  to-i 

6's,  deferred  bonds,  trust  receipts. 

DiSTEiCT  OF  Columbia  3-65's 1924, 

Small  bonds \  14,033,600 

Kegistered. . 

Funding  5's...  1899, 

Funding  5's,  smaU..  \  943,400 

Funding  5's,  reg'd. 

Railroad  Stocks. 


99,) 


Albany  &  Susquehanna 3,500,000 

Atchison,  Topeka  &  Santa  Fe 68,000,000 

Atlantic  &  Pacific 25,000,000 

Beech  Creek 3,700,000 

Preferred 1,300,000 

Burlington,  Cedar  Rapids  &  Northern 5,500,000 

Buffalo,  Rochester  &  Pittsburg 6,000,000 

Preferred 6,000,000 


i6o  APPENDIX, 


Amount. 

Canada  Southern 15,000,000 

Canadian  Pacific 65,000,000 

Central  of  New  Jersey 18,563,200 

Central  Iowa 9,100,000 

First  preferred 907,000 

Second  preferred 1,167,800 

Central  Pacific 68,000,000 

Charlotte,  Columbia  &  Augusta 2,578,000 

Chesapeake  &  Ohio 15,906,138 

First  preferred 8,447,800 

Second  preferred 11,594,000 

Chicago  &  Alton 14,091,000 

Preferred 3,479,500 

Chicago  &  Northwestern 41,373,000 

Preferred 22,325,200 

Chicago,  St.  Paul,  Minneapolis  &  Omaha. . .  21,403,293 

Preferred 12,646,833 

Chicago,  Rock  Island  &  Pacific 50,000,000 

Chicago,  Burlington  &  Quincy 76,385,700 

Chicago,  Milwaukee  &  St.  Paul 39,680,361 

Preferred 21,555,900 

Chicago  &  Eastern  Illinois 3,000,000 

Chicago,  St.  Louis  &  Pittsburg 10,000,000 

Preferred. . .    20,000,000 

Chicago  &  Indiana  Coal  Railway  Company.  2,197,800 

Preferred 1,465,200 

Cincinnati,  New  Orleans  &  Texas  Pacific. . .  3,000,000 

Cincinnati,  Indianapolis,  St.  Louis  &  Chicago.  10,000,000 

Cincinnati,  Jackson  &  Mackinac 8,320,000 

Preferred 4,680,000 

Cleveland  &  Pittsburg  Guaranteed 11,243,736 

Cleveland,  Columbus,  Cincinnati  &  Ind's. . .  14,991,800 

Columbia  &  Greenville 1,000,000 


INVESTMENT  SECURITIES. 


Amount. 

Columbia  &  Greenville  preferred 1,000,000 

Columbus,  Hocking  Valley  &  Toledo 11,700,000 

Delaware,  Lackawanna  &  Western 26,200,000 

Morris  &  Essex 15,000,000 

New  York,  Lackawanna  &  Western 10,000,000 

Dubuque  &  Sioux  City 5,000,000 

Denver  &  Rio  Grande , 38,000,000 

Preferred , 23,650,000 

Denver  &  Rio  Grande  Western 7,500,000 

Denver,  South  Park  &  Pacific 3,500,000 

Des  Moines  &  Fort  Dodge 4,283,100 

Preferred 763,000 

Detroit,  Mackinac  &  Marquette 4,750,000 

Detroit,  Bay  City  &  Alpena 1,070,000 

East  Tennessee,  Virginia  &  Georgia 27,500,000 

First  preferred 11,000,000 

Second  preferred 18,500,000 

Elizabethtown,  Lexington  &  Big  Sandy 5,000,000 

Evansville  &  Terre  Haute 3,000,000 

Flint  &  Pere  Marquette  preferred 6,500,000 

Green  Bay,  Winona  &  St.  Paul 8,000,000 

Preferred 2,000,000 

Harlem 8,518,100 

Preferred 1,381,500 

Houston  &  Texas  Central 10,000,000 

Illinois  Central 40,000,000 

Leased  line,  4  per  cent  stock 10,000,000 

Indiana,  Bloomington  &  Western \ 

Associated  first  installment  paid )■  10,000,000 

Associated  full  assessment  paid ) 

Joliet  &  Chicago 1,500,000 

Kentucky  Central 6,600,000 

Keokuk  &  Western 4,000,000 


i62  APPENDIX. 


Amount. 

Kingston  &  Pembroke 4,500,000 

Lake  Erie  &  Western 11,840,000 

Preferred 11,840,000 

Lake  Shore  &  Michigan  Southern 49,466,500 

Long  Island 10,000,000 

Louisville  &  Nashville 30,000,000 

Louisville,  New  Albany  &  Chicago 5,000,000 

Manhattan  Railroad  Consolidated 23,895,630 

Marquette,  Houghton  &  Ontonagon 2,378,600 

Preferred 3,278,500 

Mexican  Central  (Limited) 35,000,000 

Milwaukee,  Lake  Shore  &  Western 2,000,000 

Preferred 5,000,000 

Milwaukee  &  Northern 4,131,000 

Michigan  Central 18,738,204 

Missouri  Pacific 45,000,000 

Missouri,  Kansas  &  Texas 46,405,000 

Mobile  &  Ohio  Railroad  Associated 5,320,600 

Morgan's  Louisiana  &  Texas  R.  R.  &  S,  S. .  1,004,100 

Minneapolis  &  St.  Louis 6,000,000 

Preferred 4,000,000 

Minneapolis,  Sault  Ste.  Marie  &  Atlantic. .  2,426,000 

Preferred 2,426,000 

New  York  Central  &  Hudson  River 89,428,300 

New  York,  New  Haven  &  Hartford 15,500,000 

Boston    &    N.    Y.    Air    Line    preferred 

4pc 3,000,000 

New  York,  Lake  Erie  &  Western 78,000,000 

Preferred 8,536,900 

New  York,  Ontario  &  Western 58,113,982 

New  York  &  New  England 20,000,000 

New  Jersey  &  New  York 1,500,000 

Preferred 800,000 


INVESTMENT  SECURITIES.  163 

Amount. 

New  York,  Chicago  &  St.  Louis )    28  000  000 

Assented ) 

P^^^«^^^^ \   22,000,000 

Assented ) 

New  York,  Susquehanna  &  Western 13,000,000 

Preferred 8,000,000 

Northern  Pacific 49,000,000 

Preferred 37,936,776 

Nashville,  Chattanooga  &  St.  Louis 6,688,375 

Norfolk  &  Western 7,000,000 

Preferred. . .   22,000,000 

Norfolk  Southern 1,000,000 

Ohio  &  Mississippi 20,000,000 

Preferred 4,030,000 

Ohio  Southern 3,840,000 

Omaha  &  St.  Louis  preferred 2,220,500 

Oregon  &  California 7,000,000 

Preferred 12,000,000 

Oregon  &  Transcontinental  Company 40,000,000 

Oregon  Short  Line 15,265,000 

Oregon  Improvement  Company 7,000,000 

Oregon  Railway  &  Navigation  Company. . .  24,000,000 

Philadelphia  &  Reading,  1st  assessment  paid"] 

Second  assessment  paid !  „ ,  ^^^  ^.^ 

Third  assessment  paid j  ^^'^^^'^^^^ 

All  assessments  paid J 

Preferred  first  assessment  paid ^ 

Second  assessment  paid ' 

Third  assessment  paid j  1»286,800 

All  assessments  paid J 

Pittsburg,  Fort  Wayne  &  Chicago  Guar'd. .  19,714,285 

Special 10,776,600 

Pitts.,  McK'pt  &  Youghiogheny  Consol.  Stk.  3,000,000 


1 64  APPENDIX. 


Amount. 

Peoria,  Decatur  &  Eyansville 8,400,000 

Richmond  &  Alleghany  Reorganization  Cert.  )  f.  ^^^  ^^^ 

Stamped  assessment  paid f  '      ' 

Richmond  &  Danville 5,000,000 

Richmond  &  W.  P't.  Railway  &  W.  Co 40,000,000 

Preferred 5,000,000 

Rome,  Watertown  &  Ogdensburg 5,293,900 

Utica  &  Black  River  Guaranteed 2,223,000 

South  Carolina 4,204,160 

Southern  Pacific  Company 88,076,200 

St.  Louis,  Alton  &  Terre  Haute 2,300,000 

Preferred 2,468,400 

Belleville  &  Southern  Illinois  preferred. .  1,275,000 

St.  Louis  &  San  Francisco 11,954,300 

Preferred 10,000,000 

First  preferred 4,500,000 

St.  Louis,  Arkansas  &  Texas  9,555,000 

St.  Paul  &  Duluth 4,055,400 

Preferred 5,377,003 

St.  Joseph  &  Grand  Island 4,500,000 

St.  Paul,  Minneapolis  &  Manitoba 20,000,000 

Texas  &  Pacific  Trust  c'tf 's,  all  ass'ts  paid. .  32,188,700 

Toledo  &  Ohio  Central 1,592,000 

Preferred 3,108,000 

United  New  Jersey  Railroad  &  Cons.  Co. . .  21,240,400 

Union  Pacific 60,868,500 

Utah  Central 4,250,000 

Virginia  Midland 6,000,000 

Wabash,  St.  Louis  &  Pacific \  oq  ^io  f^nn 

Full-paid  P.  C.  certificates f  -«'41J,500 

Full-paid  preferred )  24003000 

Full-paid  P.  C.  certificates f  ^4,.^d,.UU 

Wheeling  &  Lake  Erie 3,600,000 


INVESTMENT  SECURITIES.  165 


Miscellaneous  Stocks. 

Amount. 

Bankers'  &  Merchants'  Telegraph 3,000,000 

Boston  Land  Company 800,000 

Canton  Company,  Baltimore . .  4,500,000 

Chartiers  Valley  Gas  Company 3,000,000 

Central  New  Jersey  Land  Improvement 2,200,000 

Consolidated  Gas  Company 35,430,000 

Delaware  &  Hudson  Canal 24,500,000 

Equitable  Gas-Light  Company , 3,000,000 

Iron  Steamboat  Company 2,000,000 

Manhattan  Beach  Company 5,000,000 

Philadelphia  Company 7,500,000 

Pullman's  Palace  Car  Company 15,927,200 

Southern  &  Atlantic  Telegraph 948,875 

Sutro  Tunnel  Company 20,000,000 

Western  Union  Telegraph 81,200,000 

Northwestern  Telegraph 2,500,000 

Central  &  South  American  Telegraph 4,006,600 

Commercial  Telegraph  Company 1,800,000 

Preferred 200,000 

Mexican  Telegraph  Company 1,500,000 

Joliet  Steel  Company 2,666,000 

Coal  and  Mining  Stocks. 

American  Coal 1,500,000 

Consolidation  Coal  of  Maiyland . .    .  10,250,000 

Cumberland  Coal  &  Iron 500,000 

Colorado  Coal  &  Iron  Company 10,000,000 

Cameron  Iron  &  Coal  Company 2,720,900 

Columbus  &  Hocking  Coal  &  Iron 4,700,000 

Marshall  Consolidated  Coal  Company 2,000,000 

Maryland  Coal  Company 4,400,000 

New  York  &  Perry  Coal  &  Iron  Company. .  3,000,000 


1 66  APPENDIX. 


Amount. 

New  Central  Coal  Company 5,000,000 

Pennsylvania  Coal 5,000,000 

Quicksilver  Mining  Company 5,708,700 

Preferred 4,291,300 

Tennessee  Coal,  Iron  &  Railroad  Company.  10,000,000 

Express  Stocks. 

Adams  Express.. . , 12,000,000 

American  Express 18,000,000 

United  States  Express 10,000,000 

Wells  Fargo  Express 6,250,000 

Pacific  Mail  Steamship  Company 20,000,000 

Railroad  Bonds. 

Atchison,  Topeka  &  Santa  Fe  4i's 1920,  4,687,000 

Sinking-fund  6's 1911,  12,348,000 

Atlantic  &  Pacific  Guar.  1st  gold  4's.  .1937,  17,610,000 

Beech  Creek  first  gold  4's 1936,  5,000,000 

Baltimore  &  Ohio  first  6's,  Park'g  bch,  1919,  3,000,000 

5's  gold 1885-1925, 


^     .  ,      ^                                                    ,  10,000,000 

Registered 

Boston,  Hoosac  Tunnel  &  Wn.  Deb.  5's,  1913,  2,000,000 

Burlington,  C.  R.  &  Northern  1st  5's. .  1906,  6,500,000 

Con.  1st  &  Col.  Tr.,  gold  5's 1934,  )  ^  ^^^  ^^^ 

Registered f [  ^'^^^'^^^ 

Minneapolis  &  St.  Louis  1st  g  7's  g'd,  1927,  150,000 

Iowa  City  &  Western  1st  gold  7's. .  .1909,  456,000 

Cedar  Rapids,  Iowa,  P's  &  N.  1st  6's,  1920,  825,000 

1st  5's 1921,  1,905,000 

Buffalo,  N.  Y.  &  Ph.  Ry.  Con.  1st  6's,  1921,  \  ^^  ^^^  ^^ 

Trust  certificates S  '      ' 

Railroad  general  6's 1924,  )  3  ^-qq  qoo 

Trust  certificates \  '      ' 


INVESTMENT  SECURITIES.  1l^ 


Canada  Southern  1st  in't  gt'd  5's 1908, 

2d  mortgage  5's 1913, 

Registered 

Central  Iowa  1st  mortgage  7's 1899, 

Coupons  off 

Eastern  division  1st  6's 1912, 

Illinois  division  1st  6's 1912, 

Central  R.  R.  &  Bkg.  Co.  O.  col.  g  5's,  1937, 

Chesapeake  &  Ohio  Pur.  M'y.  Fd 1898, 

6's  gold.  Series  A 1908, 

6's  gold,  Series  B 1908,  ^ 

Coupons  off 

Small  bonds 1908, 

Coupons  off 

Extension  coupons,  gold  4's 1986, 

Regular  4's 1986,  j 

6's,  currency 1918,  ) 

Small  bonds 1918,  ) 

Mortgage  6's 1911, 

Chesapeake,  Ohio  &  S.  W.  Mtge.  5-6's,  1911, 

2d  mortgage  6's 1911, 

Chicago  &  Alton  1st  mortgage  7's. . .  1893, 

Sinking  fund,  gold  6's 1903, 

Louisiana  &  Missouri  River  1st  7's.  .1900, 

2d  7's 1900, 

St.  Louis,  Jacksonville  «&  C.  1st  7's . .  1894, 

1st  guaranteed  (564)  7's 1894, 

2d  mortgage  (360)  7's 1898, 

2d  guaranteed  (188)  7's 1898, 

Mississippi  River  B'ge  1st  S.  F.  g  6's,  1912, 

Chicago,  B.  &  Q.  consolidated  7's 1903, 

5's,  sinking  fund 1901, 

5's,  debentures 1913, 


Amount. 

14,000,000 
6,000,000 

3,700,000 

1,515,000 
1,520,000 
5,000,000 
2,300,000 
2,000,000 


15,000,000 


10,122,500 

2,000,000 
6,676,000 
2,495,000 
2,383,000 
2,655,000 
1,785,000 

300,000 
2,365,000 

564,000 
44,000 

188,000 

660,000 

30,000,000 

2,500,000 

9,000,000 


1 68  APPENDIX. 


Amount. 

C.  B.  &  Q.,  Iowa  Division  S.  F.  5's 1919,  3,000,000 

4's 1919,  10,591,000 

Denver  Division  4's 1922,  7,968,000 

4's 1921,  4,300,000 

Nebraska  Extension  4's 1927,  7,600,000 

Registered 400,000 

Chicago,  Burlington  &  North.  1st  5's.  .1926,  9,000,000 

Debenture  6's 1896,  2,250,000 

Chicago,  R  I.  &  Pacific  6's,  coupon. .  .1917,  )  ^^  ^^   ^^^ 

6  s,  registered 1917,  )  ' 

Extension  &  Col.  5's 1934,  }  ^^ 

Registered S  '      ' 

Des  Moines  &  Fort  Dodge  1st  4's. . . .  1905,  1,200,000 

1st  2i's 1905,  1,200,000 

Extension  4's 672,000 

Keokuk  &  Des  Moines  1st  Mg.  5's. . .  1923,  2,750,000 

Central  Railroad  of  N.  J.,  1st  7's.. .  .1890,  5,000,000 

1st  consolidated  7's 1899,  ^  ^5  {\csOi  000 

Convertible'  'r;:.v.'.';.  ;.■;.■.■.■.■.■.  .'.Voos; , 

Assented ) 

Convertible  debenture  6's 1908,  5,000,000 

Interim  bond  certificates 12,000,000 

Lehigh  &  W.  B.  Con.  guaranteed. .  .1900,  )  ^^  p,^„  „„^ 

Assented f  '      ' 

Am.  Dock  &  Improvement  Co.  5's..  .1921,  5,000,000 

M.  &  St.  Paul's  1st  M.  8's,  P.  D 1898,  3,674,000 

2d  7  3-10  P.  D 1898,  1,241,000 

1st  7's  %  gold,  R.  D 1902,  ) 

1st  7's  £  gold,  R.  D 1902,  \  ^'^^^'^^^ 

1st  mortgage  La.  Consolidated  7's,  1893,  5,264,000 

1st  mortgage  I.  &  M.  7's 1897,  3,198,000 

1st  mortgage  I.  &  D.  7's 1899,  541,000 


INVESTMENT  SECURITIES.  169 


Amount 

M.  &  St.  P.  1st  mortgage  C.  &  M.  7's .  1903,  2,393,000 

Consolidated  7's 1905,  35,000,000 

1st  mortgage  7's,  I.  &  D.  extension,  1908,  3,505,000 

1st  6's,  Southwestern  Division 1909,  4,000,000 

1st  5's  Louisiana  C.  &  Dav 1919,  3,000,000 

1st  South  Min.  Division  6's 1910,  7,432,000 

1st  H.  &  D.  Division  7's 1910,  5,680,000 

5's 1910,  585,000 

Chicago  &  Pacific  Division  6's 1910,  2,500,000 

1st  Chicago  &  Pacific  W.  5's, 1921,  24,540,000 

Chicago  &  Mo.  ftiver  Division  5's.  1926,  2,049,000 

Mineral  Point  Division  5's 1910,  2,840,000 

C.  &  Lake  Superior  Division  5's. . .  1921,  1,360,000 

Wisconsin  &  Min.  Division  5's 1921,  4,755,000 

Terminal  5's 1914,  4,666,000 

Far.  &  So.  6's  Assu 1924,  1,250,000 

Inc.  convertible  sinking  fund  5's. .  1916,  2,000,000 

Dakota  &  Great  Southern  5's 1916,  1,000,000 

Chicago  and  Northwestern  Con.  7's,  1915,  12,900,000 


'^'j-   48,000,000 


Coupon  gold  7's 1902, 

Registered  gold  7's 1902 

Sinkmg  fund  6's. 1879-1939, ) 

Kegistered )  ' 

^■■::-- 1879-1929,. 

Kegistered )  ' 

Ssr.:a!:;v;::;;;:;;;.v;;.^!^ho«o 

25  years  debenture  5's 1909,  )  .  ^^  ^^^ 

Registered )  '      ' 

Extension  gold  4's 1886-1926,  8,190,000 

Escanaba  &  Lake  Superior  1st  6's..  .1901,  720,000 

Des  Moines  &  Minneapolis  1st  7's..  .1907,  600,000 

Iowa  Midland  1st  mortgage  8's 1900,  1,350,000 

15 


170  APPENDIX, 


Amount. 

Peninsula  1st  convertible  7's 1898,  152,000 

Chicago  &  Mil.  1st  mortgage  7's 1898,  1,700,000 

Winona  &  St.  Pet's  2d  7's 1907,  1,592,000 

Milwaukee  &  Madison  1st  6's 1905,  1,600,000 

Ottumwa  C.  F.  &  St.  P.  1st  5's 1909,  1,600,000 

Northern  Illinois  1st  5's 1910,  1,500,000 

C.  C.  C.  &  Ind's  1st  7's  sinking  fund. . .  1899,  3,000,000 

Consolidated  mortgage  7's 1914,  )  -,  f,^^  ^^^ 

Sinking  fund  7's 1914,  \  ^'^^^'^^^ 

General  consolidated  gold  6's . .  .1934,  )  „  ^^^  ^^^ 

Registered S 

Chicago,  St.  Paul,  Min.  &  O'a  Con.  6's,  1930,  22,839,000 

Chicago,  St.  Paul  &  Min.  1st  6's 1918,  3,000,000 

N.  Wisconsin  1st  mortgage  6's 1930,  800,000 

St.  Paul  &  Sioux  City  1st  g.  6's 1919,  6,080,200 

Chicago  &  Eastern  Illinois  1st  S.  F.  C'y,  1907,  3,000,000 

Small  bonds 

1st  consolidated  6's  gold 1934,  3,000,000 

Chicago,  St.  L.  &  Pitts.  1st  con.  g.  5's,  1932,  )  ^^  ^^^  ^^^ 

Registered ) 

Chicago  &  Western  Ind.  1st  S.  F.  g.  6's,  1919,  2,500,000 

General  mortgage  g.  6's 1932,  8,896,666 

Chicago  &  St.  Louis  1st  6's 1915,  1,500,000 

Chicago  &  Ind.  Coal  Railway  1st  5's. . .  1936,  3,689,000 

Cin.,  Ind.,  St.  Louis  &  Chicago  1st  g.  4's,  1936,  )  ^  ^rr;  QfjA 

Registered )  '      ' 

Cin.,  Jack.  &  Mac.  1st  con.  g.  5's 1936,  1,400,000 

Columbia  &  Greenville  1st  6's 1916,  2,000,000 

2d  6's 1926,  1,000,000 

Columbus,  Hocking  V.  &  Tol.  Con.  g.  5's,  1931,  14,500,000 

General  mortgage  gold  6's 1904,  2,000,000 

Columbus  &  Cincinnati  Midland  1st  6's,  1914,  2,000,000 

Delaware,  Lack.  &  Western  Conv.  7's . .  1892,  600,000 


INVESTMENT  SECURITIES.         171 


Amount. 

Del.  Lack.  &  W.  Mortgage  7's 1907,  10,000,000 

Syracuse,  Binghamton  &  N.  Y.  1st  Ts,  1906,  1,750,000 

Morris  &  Essex  1st  mortgage  7's 1914,  5,000,000 

2d  7's 1891,  3,000,000 

Bonds  rs 1900,  281,000 

rs  of. 1871-1901,  4,991,000 

1st  consolidated  guaranteed  7's. .  .1915,  25,000,000 

New  York,  Lack.  &  Western  1st  6's. .  1921,  12,000,000 

Construction  5's . .  .1923,  5,000,000 

Del.  &  Hudson  Canal  1st  reg.  7's.. .  .1891,  4,988,000 

1st  extension  regular  7's 1891,  549,000 

^''"P-'^'^h; ^Zl\  4.829,000 

Registered  7's 1894,)  '      ' 

1st  Pennsylvania  Division  c.  7's. . .  1917,  )  ^  ^  ^^^  ^^^ 

Registered 1917,)  '      ' 

Albany  &  Susquehanna  1st  7's 1888,  1,000,000 

1st  con.  guaranteed  7's 1906,  )  „  ^^^  ^^^ 

Registered \  ^'^^^'^^^ 

6's 1906 


T,     .  ,      1                                              I  5,488,000 

Registered ) 

Rens'r  &  Saratoga  1st  coupon  7's.. .  .1921,  )  «  «^^  ^„^ 

1st  regular  7's 1921,)  '      ' 

Denver  &  Rio  Grande  1st  Con.  g.  4's.  .1936,  22,575,000 

Denver  &  Rio  Grande  1st  mort.  g.  7's,  1900,  6,382,500 

Denver,  S.  P'k  &  Pacific  1st  g.  7's 1905,  1,800,000 

Denver  &  Rio  Grande  W'n  1st  g.  6's.  .1911,  )  ^  ^^.^  ^^^ 

Assented j  '      ' 

Detroit,  Mackinac  &  Marquette  1st  6's,  1921,  2,280,000 

Land  grant  3^  S.  A , 1911,  4,560,000 

Detroit,  Bay  City  &  Alpena  1st  g.  6's..  1913,  2,300,000 

E.  Tenn.,  Virginia  &  Georgia  1st  7's. . .  1900,  3,500,000 

Divisional  5's 1930,  3,106,000 

E.  Tenn.,  Va.  &  Ga.  Ry.  con.  1st  g.  5's,  1956,  12,770,000 


172  APPENDIX. 

Amount. 

E.  &  W.  of  Alabama  1st  con.  gold  6's. .  1926,  1,709,000 

Elizabeth  City  &  Norfolk  S.  F.  deb.  cert.  6's. .  250,000 

1st  mortgage  g.  6's 1920,  900,000 

Elizabethtown,  Lex.  &  Big  Sandy  6's.  .1902,  3,500,000 

Erie  1st  mortgage  exten'd  g.  7's. ......  1897,  2,482,000 

2d  exten'd  g.  5's 1919,  2,149,000 

3d  exten.  g.  4i's 1923,  4,618,000 

4th  exten.  g.  5's 1920,  2,926,000 

5th  7's 1888,  709,500 

1st  con.  gold  7's 1920,  16,890,000 

1st  con.  gold  F'd  7's 1920,  3,705,997 

Reorganization  1st  lien  6's 1908,  2,500,000 

Long  Dock  bonds  Ts. 1893,  3,000,000 

Consolidated  gold  6's 1935,  4,500,000 

Buffalo,  New  York  &  Erie  1st  7's. .  .1916,  2,380,000 

N.  Y.  L.  E.  &  W.  new  2d  con.  6's. . .  1969,  33,597,400 

Collateral  Trust  6's 1922,  5,000,000 

Funding  coupon  5's. .1885-1969,  4,032,000 

Buffalo  &  Southwestern  mort.  g.  6's,  1908,  )  ^  ^^^  ^^^ 

Small .....)  '      ' 

Evansville  &  Terre  H.  1st  con.  g.  6's.  .1921,  3,000,000 

Mount  Vernon  1st  6's .1923,  375,000 

Evansville  &  In's  1st  con.  gtd  g.  6's. .  .1926,  1,020,000 

Eureka  Springs  Railway  1st  6's  g 1933,  500,000 

Flint  &  Pere  Marquette  mort.  g.  6's. . .  1920,  5,000,000 

Fort  Worth  &  Denver  City  1st  6's 1921,  6,448,000 

Galveston,  Har.  &  San  Ant.  1st  g.  6's.  .1910,  4,800,000 

2d  mortgage  g.  7's 1905,  1,000,000 

Western  Division  1st  g.  5's 1931,  13,500,000 

2d  6's 1931,  6,750,000 

Grand  Rapids  &  Ind.  general  5's 1924,  )  g  ^yi  qoO 

Registered , ) 

Green  Bay,  W.  &  St.  Paul  1st  6's 1911,  1,600,000 


INVESTMENT  SECURITIES.  173 


Amount. 

Oulf ,  Colorado  &  Santa  Fe  1st  7's 1909,  11,724,000 

GoldO's 1923,  6,000,000 

Hannibal  &  St.  Joseph  consolidated  6's,  1911,  6,000,000 

Henderson  Bridge  Company  1st  g.  6's,  1931,  2,000,000 

Houston  &  Texas  Cent.  1st  M'n  L.  7's,  1891,  6,896,000 

1st  Western  Division  7's 1891,  3,375,000 

1st  Waco  &  N.  7's 1903,  1,140,000 

2d  C.  Main  L.  8's 1912,  4,118,000 

General  mortgage  g.  6's 1921,  )  ^  g^^  ^^^ 

Trust  Company  receipts )  '  "  ' 

Houston,  E.  &  W.  Texas  1st  g.  7's 1898,  1,344,000 

Illinois  Central. 

if' P^-^t'' ^^''^'\  1.500,000 

Registered ) 

^^^^^^^^^'^ • ^^^^'^  2,500,000 


\   18,000,000 


Registered 

Springfield  Division  coupon  6's 1898,  1,600,000 

Middle  Division  regular  5's 1921,  600,000 

Chicago,  St.  L.  &  N.  0.  Ten.  lien  7's,  1897,  541,000 

1st  con.  7's 1897,  857,000 

2d  mortgage  6's 1907,  80,000 

Gold  5's 1951, 

Registered 

Dubuque  &  Sioux  City  2d  div.  7's. . .  1894,  586,000 

Cedar  Falls  &  Minneapolis  1st  7's. .  .1907,  1,334,000 

Indiana,  Bl'n  &  W.  1st  preferred  7's. . .  1900,  1,000,000 

1st  5-6's  trust  receipts 3,408,000 

2d  5-6's  trust  receipts 1,477,000 

Eastern  Division  trust  receipts 2,950,000 

Ind's,  D.  &  Sp.  1st  7's  Ex.  F.  coupon.  .1906,  1,613,000 

International  &  Great  N'n  1st  6's  gold,  1919,  7,954,000 

Coupon  6's 1909,  7,054,000 

Kentucky  Central  Railway  gold  4's . . .  1987,  6,600,000 


74  APPENDIX, 


25,000,000 
25,000,000 


Amount. 

Knoxville  &  Ohio  1st  6's  gold 1925,  2,000,000 

Lake  Erie  &  Western  1st  gold  5's 1937,  5,920,000 

Lake  Shore  &  Michigan  Southern. 

Cleveland,  Pain'le  &  Ash.  7's 1892,  920,000 

Buffalo  &  Erie  new  bonds  7's 1898,  2,784,000 

Kalamazoo  &  W.  Pig'n  1st  7's 1890,  400,000 

Detroit,  Montreal  &  Toledo  1st  7's.  .1906,  924,000 

Lake  Shore  Division  bonds  7's 1899,  1,356,000 

Consolidated  coupon  1st  7's 1900, 

Registered  1st 1900, 

Coupon  2d  7's.  1903, 

Registered  2d 1903, 

Mahoning  Coal  Railroad  1st  5's 1934,  1,500,000 

Long  Island  1st  mortgage  7's 1898,  1,500,000 

1st  consolidated  g.  5's 1931,  5,000,000 

New  York  &  Manhattan  B'h  1st  7's,  1897,  500,000 

New  Y.,  B.  &  Man.  B.  1st  con.  g.  5's,  1935,  783,000 

Louisville  &  Nashville  consolidated  7's,  1898,  7,070,000 

Cecilian  Branch  7's 1907,  1,000,000 

New  Orleans  &  Mobile  1st  g.  6's. . .  .1930,  5,000,000 

2d  6's 1930,  1,000,000 

E.  H.  &  Nashville  1st  g.  6's 1919,  2,400,000 

General  mortgage  g.  6's 1930,  20,000,000 

Pensacola  Division  6's 1920,  600,000 

St.  Louis  Division  1st  g.  6's 1921,  3,500,000 

2d  g.  3's 1980,  3,000,000 

Nashville  &  Dec.  1st  7's 1900,  1,900,000 

South  &  N.  Ala.  sinking  fund  6's. .  .1910,  2,000,000 

Louisville,  Cin.  &  Lexington  g.  6's.  .1931,  7,000,000 

Trust  bonds  g.  6's 1922,  10,000,000 

Ten-forty  g.  6's 1924,  5,000,000 

5  per  cent  fifty  year  gold  bonds 1937,  1,350,000 

Pens.  &  At.  1st  6's  gold  guaranteed,  1921,  3,000,000 


INVESTMENT  SECURITIES.  175 


Amount. 

Louisville,  N.  Albany  &  Chicago  1st  6's,  1910,  3,000,000 

Consolidated  gold  6's 1916,  3,500,000 

Louisville,  N.  0.  &  Texas  1st  gold  4's,  1934,  11,140,000 

2d  mortgage  5's 1934,  8,117,000 

Memphis  &  Charleston  6's  gold 1924,  1,000,000 

Metropolitan  Elevated  1st  g.  6's 1908,  10,818,000 

2d  6's 1899,  4,000,000 

Mexican  Central  1st  mortgage  7's 1911,  \ 

Ex-coupon  6-7-8 t  41,170,000 

New  assented  4's ) 

Income  bonds 1911,  8,734,000 

Michigan  Central  1st  consolidated  7's.  1902,  8,000,000 

5's 1902,  2,000,000 

6's 1909,  1,500,000 


Coupon  5's 1931,  .  „„„  „ „^ 

T>     •  1.      J  (ri  ^^o/  r     4,000,000 

Registered  5's 1931,  )       '      ' 

Jack.,  Lan.  &  Sag.  6's 1891,  1,100,000 

Milwaukee  &  Nor.  1st  main  line,  6's..  .1910,  2,155,000 

On  extension  1st  6's 1913,  1,976,000 

Milwaukee,  Lake  Shore  &  W'n  1st  g.  6's,  1921,  4,350,000 

Convertible  debenture  5's 1907,  600,000 

Michigan  Division  1st  6's 1924,  1,281,000 

Ashland  Division  1st  g.  6'«. 1925,  1,000,000 

Minneapolis  &  St.  Louis  1st  g.  7's 1927,  950,000 

Iowa  extension  1st  g.  7's 1909,  1,015,000 

2d  mortgage  7's 1891,  500,000 

Southwestern  extension  1st  g.  7's. .  .1910,  636,000 

Pacific  extension  1st  g.  6's 1921,  1,382,000 

Improvement  &  Equipment  6's 1922,  2,900,000 

Minneapolis  &  Pacific  1st  mortgage  5's,  1936,  3,035,000 

Minneapolis  &  Northwestern  1st  5's  g.,  1934,  7,783,000 

Minn.,  Sault  Ste.  Marie  &  Atl.  1st  g.  5's,  1926,  4,000,000 

Missouri,  Kansas  &  T.  Gen.  Cons.  g.  6's,  1920,  85,815,000 


176  APPENDIX. 


Amount. 

M.  K.  &  T.  Gold  5's 1920,  9,284,000 

Consolidated  g.  7's 1904-5-6,  14,877,000 

2d  mortgage  Inc 1911,  630,000 

H.  &  Central  Missouri  1st  g.  7's 1800,  664,000 

Mobile  &  Ohio  new  mortgage  g.  6's . . .  1927,  7,000,000 

Collateral  trust  6's 1892,  59,000 

1st  extension  6's 1927,  1,000,000 

St.  Louis  &  Cairo  g.  4's  guaranteed,  1931,  4,000,000 

Morgan's  Louisiana  &  Texas  1st  g.  6's,  1920,  1,494,000 

1st  7's .....1918,  5,000,000 

Nashville,  Chat.  &  St.  Louis  1st  7's. . . .  1913,  6,800,000 

2d  6's 1901,  1,000,000 

New  York  Central  6's 1887,  2,391,000 

Debt,  certificates  extended  5's 1893,  6,450,000 


New  York  &  Hudson  1st  coupon  7's,  1903,  )  ^n  nnn  nr\n 

1st  registered 1903,  )  ' 

Debenture  5's 1904^ )  ^  ^^^  ^^ 

Registered )  '      ' 

Harlem  1st  mortgage  7's,  coupon. .  .1900,  )  ..^  ^^^  ^-.^ 

7's,  registered 1900,  S  ^^'"""'""" 

New  Jersey  Junction  guar.  1st  4's 1986,  )  ^  ^^  ^^ 

Registered  certificates )  '      ' 


New  York  Elevated  1st  moftgage  7's.  .1906,  8,500,000 

New  York,  Penn.  &  Ohio  prior  lien  6's,  1895,  8,000,000 
New  York  City  &  Northern  Gen.  M.  6's,  1910^  \ 

Trust  Company  receipts .'  [•  4,000,000 

Assented ) 

New  York  &  New  England  1st  7's 1905,  6,000,000 

1st  6's 1905,  4,000,000 

N.  Y.,  Ch.  &  St.  L.  1st  6's  T't  Rec.  Ass'd.  ^  \  ^^  qqq  qqq 

New  Trust  Company  receipts )  '      ' 

2d  6's 1923,  10,000,000 

New  York,  Ontario  &  W.  1st  gold  6's. .  1914,  3,000,000 


INVESTMENT  SECURITIES.  177 


Amount. 

New  York,  Susq'a  &  Wn  debent.  6's. .  1897,  )  ^^^  ^^^ 

Coupons  off )  ' 

1st  refunding  5's 1937,  3,750,000 

2d  mortgage  4i's 1937,  636,000 

Midland  Railroad  of  New  J.  1st  6's,  1910,  3,500,000 

N.  Y.,  N.  Haven  «&  Hartford  1st  reg.  4's,  1903,  2,000,000 

N.  Y.,  Texas  &  Mexican  guar.  1st  4's. .  1912,  1,442,500 

Northern  Pacific  Gen.  1st  M.  R.  R.,  coupon  )  ^^  „^^  ^^^ 

L'd  Gt.  gold  6's,  1921,  regular \  ^^'^^^'O^O 

Gen.  2d  M.  R.  R.,  coupon )  20  000  000 

L.  G.  sinking  fund  gold  6's,  1933,  regular  )  '      ' 

Dividend  scrip )  ^1 

Extended ) 

James  River  Valley  1st  6's,  gold. . .  .1936,  963,000 

Spokane  &  Pal.  1st  sinking  fund  g.  6's,  1936,  688,000 

St.  Paul  &  N.  Pacific  Gen.  g.  6's 1923,  )  ^  g^^  qqq 

Registered  certificates ) 

Helena  &  Red  M'n  1st  g.  6's 1937,  400,000 

Duluth  &  Manitoba  1st  g.  6's 1936,  1,650,000 

Hel.  B.  Valley  &  Butte  1st  6's,  g. . .  .1937,  600,000 

Nor.  Pacific  Term'l  Co.  1st  gold  6's. .  .1933,  3,000,000 

New  Orleans  Pacific  1st  6's,  gold 1920,  \ 

Couponsofl [  6,720,000 

Trust  Company  receipts ) 

N.  Orleans  &  N.  E'n. prior  lien  gold  6's,  1915,  1,050,000 

Norfolk  &  Western  Gen'i  Mort.  6's. . .  .1931,  6,902,000 

New  River  1st  6's 1932,  2,000,000 

Improvement  &  extension  g.  6's 1934,  3,500,000 

Adjustment  mortgage  g.  7's 1924,  1,500,000 

Ogdensburg  &  L.  Champlain  1st  con.  6's,  1920,  3,500,000 

Ohio  &  Miss.  Cons,  sinking  fund  7's. .  .1898,  3,435,000 

Consolidated  7's.. 1898,  ■  3,066,000 

2d  consolidated  7's 1911,  3,715,000 


78 


APPENDIX. 


Ohio  &  Miss.  1st  Springfield  Division  7's.l905, 

1st  general  5's 1932, 

Ohio  Central  1st  Ter'l  Trust  6's 1920, 

1st  Min'l  Division  6's 1921, 

Ohio  Eiver  Railroad  1st  g.  5's 1936, 

Ohio  Southern  1st  mortgage  6's 1921, 

Omaha  &  St.  Louis  Railway  1st  4's.. .  .1937, 

Oregon  &  California  1st  g.  6's 1921, 

Oregon  &  Transcontinental  6's..  .1882-1922, 

Oregon  Improvement  Co.  1st  g.  6's 1910, 

Oregon  R'y  &  Navigation  1st  g.  6's.. .  .1909, 

Consolidated  mortgage  g.  5's 1925, 

Panama  sinking  fund  Sub'y  g.  6's 1910, 

Peoria,  Decatur  &  Evansville  1st  6's..  .1920, 

Evansville  Division  1st  6's 1920, 

2d  mortgage  g.  5's 1927, 

Peoria  &  Pekin  Union  1st  g.  6's 1921, 

2d  mortgage  g.  4|'s 1921, 

Central  Pacific,  gold  bonds  6's 1895, 

"  "  1896, 

"  1897, 

"  «  1898, 

San  Joaq'n  Branch  g.  6's 1900, 

California  &  Oregon  1st  g.  6's 1888, 

Series  B.  g.  6's 1892, 

Land  grant  g.  6's 1890, 

Mortgage  bond  6's 1936, 

Western  Pacific  bonds  6's 1899, 

Nor.  R'y  (Cal.)  1st  g.  6's  guaranteed.  1907, 
Southern  Pacific  of  Cal.  1st  g.  6's,  1905-'12, 
S.  Pacific  of  Arizona  guar.  1st  6's,  1909-'10, 
Southern  Pacific  of  N.  Mexico  1st  6's,  1911, 


Amount. 
3,000,000 
3,216,000 
600,000 
300,000 
2,000,000 
2,100,000 
2,717,000 
9,000,000 
10,063,000 
5,000,000 
6,000,000 
9,137,000 
2,747,000 
1,287,000 
1,470,000 
2,088,000 
1,500,000 
1,499,000 

25,883,000 

6,080,000 

6,000,000 

5,860,000 

9,436,000 

12,000,000 

2,735,000 

3,964,000 

38,447,000 

10,000,000 

5,000,000 


INVESTMENT  SECURITIES, 


79 


Union  Pacific  1st  6's. 


189G, 

1897, 

«  "  1898, 

1899, 

Land  grants  7's 1888-'89, ' 

Sinking  fund  8's 1893,  ) 

Registered  8's 1893,  S 

Collateral  trust  6's 1908, 

5's...  1907, 

Kansas  Pacific  1st  6's 1895, 

1st  6's 1896, 

Denver  Division  6's  assented 1899, 

1st  consolidated  6's 1919, 

Central  Branch  U.  P.  F'd  coup.  7's.  .1895, 

Atchison,  Col.  &  Pacific  1st  6's 1905, 

Atchison  Jew'l  Co.  &  W.  1st  6's 1905, 

Oregon  Short  Line  1st  6's 1922, 

Utah  Southern  Gen'l  mortgage  7's.  .1909, 

Extension  1st  7's 1909, 

Missouri  Pacific  1st  consolidated  6's,  1920, 

3d  mortgage  7's 1906, 

Pacific  Railway  of  Mo.  1st  mort.  6's,  1888, 

2d  mortgage  7's 1891, 

Verdig's  Valley,  Ind.  &  W.  1st  5's..  .1926, 
Leroy  &  City  Val.  Air  Line  1st  5's.  .1926, 
St.  L.  &  San  Fran.  2d  6's,  class  A. .  .1906, 

6's,  class  C 1906, 

6's,  class  B 1906, 

1st  6's  Pierce  C.  &  0.  branch 

Equipment  7's 1895, 

General  mortgage  6's 1931, 

5's 1931, 

South  Pacific  R.  of  Missouri  1st  6's.  1888, 


Amount. 
27,229,000 

1,270,000 

14,348,000 

4,423,000 

5,583,000 

2,240,000 

4,063,000 

6,242,000 

13,855,000 

630,000 

3,672,000 

542,000 

14,931,000 

1,950,000 

1,950,000 

20,184,000 

3,328,000 

7,000,000 

2,573,000 

750,000 

520,000 

500,000 

2,400,000 

2,766,500 

1,090,000 

650,000 

7,732,000 

5,000,000 

7,144,500 


i8o  APPENDIX. 


Amount. 

Kansas  City  &  S.  W'n  1st  6's  gold..  .1916,  744,000 

Ft.  S'th  &  Van  B.  Bdg.  1st  6's 1910,  475,000 

St.  Louis,  Kan.  &  S.  W'n  1st  6's 1916,  735,000 

Texas  &  Pacific  Railway  1st  6's 1905,  )  „  „^.  ^^^ 

Ex.  coupon )  '      ' 

Consolidated  6's,  trust  receipts 9,316,000 

Inc.  Land  Grant  Asst'd  trust  receipts 7,992,000 

R.  G.  6's  1930,  trust  receipts 13,028,000 

General  Mort.  &  T.  trust  receipts 2,859,000 

Pennsylvania  Railroad  Company. 

Pennsylvania  Co.'s guar. ^  1st  coup.,  1921,  \  ^k  qqa  qqq 

Regular 1921,)  '      ' 

Pittsburg,  Chicago  &  St.  Louis  1st  coup. 

7's 1900,  2,706,000 

1st  regular  7's 1900,  4,157,000 

2d  7's 1913,  2,500,000 

Pitts.,  Fort  Wayne  &  C.  1st  7's 1912,  5,250,000 

2d  7's 1912,  5,160,000 

3d  rs 1912,  2,000,000 

Clev.  &  Pittsburg  Cons.  S.  F.  7's. . .  .1900,  2,292,000 

4th  sinking  fund  6's 1892,  1,105,000 

St.  L.,  V'a  &  T.  H.  1st  gtd  7's 1897,  1,899,000 

2d  7's 3898,  1,000,000 

2d  guaranteed  7's 1898,  1,600,000 

Phil.  &  Reading  Inc.  M.  Coupon  7's..  .1896, 

Trust  receipts [■  10,000,000 

4th  assessment  paid 

Debenture  coupon  6's 1893, 

Trust  receipts \  670,500 

4th  assessment  paid 

Debenture  convertible  7's 1893, 

Trust  receipts \  10,395,900 

4th  assessment  paid 


I 


INVESTMENT  SECURITIES.  i8i 


Amoant. 
Phil.  &  R.  Preferred  1st  series  con.  5's  1922,  ^ 

Trust  receipts V  6,000,000 

4th  assessment  paid * 

2d  assessment  5's 1933,  \ 

Trust  receipts T  5,000,000 

4th  assessment  paid ) 

Pine  Creek  Railway  6's  of 1932,  3,500,000 

Pittsburg,  Cleveland  &  Tol.  1st  6's. . .  .1922,  2,400,000 

Pittsburg  Junction  1st  6's 1922,  1,440,000 

Pittsburg,  McKeesp't  &  Y.  1st  6's. . .  .1932,  2,250,000 

Rome,  Wat.  &  Ogdensburg  1st  7's 1891,  1,021,500 

Consolidated  1st  extension  5's 1922,  6,337,000 

Rochester  &  Pittsburg  1st  6's 1921,  1,300,000 

Consolidated  1st  6's 1922,  8,920,000 

Richmond  &  Alleghany  1st  7's.. 1920,  \ 

Trust  Company  receipts [•  5,000,000 

Stamped. ) 

Richmond  &  Danville  cons.  g.  6's 1915,  6,000,000 

Debenture  6's 1927,^  4,000,000 

Extension  coupon ) 

Con.  mortgage  gold  5's 1936,  1,500,000 

Atlanta  &  Char.  1st  preferred  7's. . . .  1897,  500,000 

Atlanta  &  Charlotte  Inc 1900,  750,000 

Richmond  &  W.  P't  Ter'l  Trust  6's. .  .1897,  8,500,000 

San  A.  &  Arans  Pass  1st  g.  6's..  .1885-1916,  1,750,000 

1886-1926,  2,598,000 

Scioto  Valley  1st  consolidated  7's 1910,  )  ^m  qqq 

Coupons  off )  ' 

St.  Joseph  &  G'd  Island  1st  6's 1925,  7,000,000 

St.  Louis  &  Iron  Mountain  1st  7's 1892,  4,000,000 

2d  7's 1897,  6,000,000 

Arkansas  Branch  1st  7's 1895,  2,500,000 

Cairo  &  Fulton  1st  7's 1891,  7,555,000 


1 82  APPENDIX. 


Amount. 

Cairo,  Arkansas  &  T.  1st  7's 1897,  1,450,000 

Gen.  con.  railroad  &  land-grant  5's,  1931,  38,201,000 

St.  Louis,  Alt'n  &  T.  H'te  1st  7's. . . .  1894,  2,200,000 

2d  mortgage  preferred  7's 1894,  2,800,000 

2d  mortgage  inconvertible  7's 1894,  1,700,000 

Belleville  &  S.  Ills.  Railway  1st  8's. .  1896,  1,041,000 

Belleville  &  Carond't  1st  6's 1923,  485,000 

St.  Louis,  Ark.  &  Tex.  1st  certi.  6's. . . .  1936,  12,870,000 

2d  certificates  6's 1936,  11,804,000 

St.  Paul,  Minn.  &  Manitoba  1st  7's 1909,  )  .  ^^^  ^^ 

Small )  '      ' 

2d  6's 1909,  8,000,000 

Dakota  extension  6's 1910,  5,676,000 

1st  consolidated  6's 1933, 

Registered.    I  33^444^000 

Reduced  to  4^  s , 

Registered 

Minneapolis  Union  1st  6's 1922,  2,150,000 

St.  Paul  &  Duluth  1st  5's 1931,  1,000,000 

South  Carolina  Railway  1st  6's 1920,  5,000,000 

2d  6's 1931,  1,500,000 

Shenandoah  Valley  1st  7's 1909,  )  ^  ^^^  ^  „ 

Trust  Company  receipts )  ''^    ' 

General  mortgage  6's 1921,  ^  4-110  oOO 

Trust  receipts S  '      ' 

Sodus  Bay  &  S.  1st  5's  gold 1924,  500,000 

Texas  Central  1st  sinking  fund  7's ... .  1909,  2,145,000 

1st  mortgage  7's 1911,  1,254,000 

Texas  &  New  Orleans  1st  7's 1905,  1,620,000 

Sabine  Division  1st  6's 1912,  2,075,000 

Tol.  &  Ohio  Central  1st  gold  5's 1935,  3,000,000 

ToL,  Peoria  &  Western  1st  7's 1917,  )  4  5QA  aaq 


Trust  Company  receipts. 


INVESTMENT  SECURITIES.  183 


Amount. 

Tol.,  Ann  A.  &  N.  Michigan  1st  6's. . .  1924,  2,120,000 

Tol.,  Ann  Arbor  &  G.  T.  1st  6's  gold.  .1921,  1,260,000 

Tol.,  St.  L.  &  Kansas  City  1st  g.  6's. .  .1916,  2,000,000 

Val'y  Railway  Co.  of  0.  Con.  gold  6's..  1921,  1,700,000 

Virginia  Midland  mortgage  Inc.  6's . . .  1927,  604,000 

General  mortgage  5's 1936,  3,717,000 

Wabash,  St.  L.  &  Pac.  gen'l  mort.  6's,  1920,  )  ^^  ^^^  ^^^ 

Trust  Company  receipts ) 

Chicago  Division  5's 1910,  4,500,000 

Havana  Division  6's 1910,  1,600,000 

Indianapolis  Division  6's 1921,  2,275,000 

Detroit  Division  6's 1921,  2,052,000 

Cairo  Division  5's 1931,  3,857,000 

Wabash  Railroad  mortgage  7's . .  1879-1909,  2,000,000 

Tol.  &  Wabash  1st  extended  7's 1890,  3,400,000 

1st  St.  Louis  Division  7's 1889,  2,700,000 

2d  mortgage  extended  7's 1893,  2,500,000 

Equip,  bonds  7's 1883,  600,000 

Consolidated  convertible  7's 1907,  2,600,000 

Great  Western  1st  mortgage  7's 1888,  2,500,000 

2d  mortgage  7's 1893,  2,500,000 

Quincy  &  Tol.  1st  mortgage  7's 1890,  500,000 

Hannibal  &  Naples  1st  7's 1909,  500,000 

111.  &  So.  Iowa  1st  extension  6's 1912,  300,000 

St.  L.,  K.,  N.  R'l  Est'e  &  R.  7's 1395,  3,000,000 

Clarinda  branch  6's 1919,  264,000 

St.  Chas.  B'ge  1st  6's 1908,  1,000,000 

Northern  Missouri  1st  mortgage  7's,  1895,  6,000,000 

Wab.,  St.  L.  &  P.  Iowa  trust  receipts 2,269,000 

West  Shore  1st  mortgage  4's  guaranteed. . .  )  ^^  ^^^  ^^^ 

Registered ) 

Western  Union  coupon  7's 1900,  )  „  qqq  qqq 

Registered ) 


[84  APPENDIX. 


Amount. 

Northwestern  Telegraph  7's 1994,  1,250,000 

Wheeling  &  Lake  Erie  1st  5's 1926,  3,000,000 

Mutual  Union  Telegraph  Sk'g  F.  6's.  .1911,  5,000,000 

Man.  B.  Improvement  Co.  limited  7's..  1909,  1,000,000 

Colorado,  C'l  &  I'n  1st  construction  6's,  1900,  3,500,000 

Tenn.  Coal,  Iron  &  R.  Con.  6's 1901,  620,000 

South  Pittsburg  1st  6's 1902,  720,000 

Bir.  Division  1st  Con.  6's 1917,  4,000,000 

Col.  &  Hock'g  Coal  &  Iron  6's  g 1917,  1,000,000 


\   10,500,000 


Income  Bonds. 

Atlantic  &  Pac.  W'n  Division  Inc 1910, 

Small 

Central  Division  Inc 1922,  2,100,000 

Central  Iowa  coupon  debenture  certificates.  620,000 

Chicago  &  Eastern  Illinois  income 1907,  1,000,000 

Des  M's  &  Fort  D.  1st  Inc.  6's 1905,  1,200,000 

Det.,  Mack.  &  Marquette  Inc 1921,  1,500,000 

Elizabeth  City  &  Nor.  2d  Inc 1970,  1,000,000 

G.  Bay,  W.  &  St.  Paul  2d  Inc 1911,  3,781,000 

Ind.,  Bl'n  &  W.  Cons.  Inc.  trust  receipts. . .  4,560,000 

Ind's,  Decatur  &  Sp'd  2d  Inc 1906, 


m      ,  n                      •  .                                 (  2,850,000 

Trust  Company  receipts ) 

Lehigh  &  W.  B're  Coal  Company 1888,  )  ^-,-,0900 

Small  bonds 1888,  i"  ^'^^'^''"^^ 

Mil.,  Lake  Shore  &  Western  Income 500,000 

Mobile  &  Ohio  1st  preferred  debenture 4,763,000 

2d  preferred  debentures 1,850,000 

3d  preferred  debentures 600,000 

4th  preferred  debentures 900,000 

New  York,  Lake  Erie  &  W'n  Inc.  6's.  .1977,  508,000 

New  York,  Penn.  &  0. 1st  Inc.  ace.  7's,  1905,  35,000,000 

Ohio  Central  Min.  Division  Inc.  7's. .  .1921,  300,000 


INVESTMENT  SECURITIES.  185 


Amount. 

Ohio  Southern  2d  Income  6's 1921,  2,100,000 

Og'b'g  &  Lake  Champlain  Income. . . .  1920,  800,000 

Small.. 200,000 

Kochester  &  Pittsburg  Income 1921,  478,000 

South  Carolina  Railway  Income  6's. .  .1931,  3,000,000 

St.  L.,  I.  M.  &  S.  1st  7's  preferred  int.  ae'e.;  348,000 

Sterling  Iron  &  Railway  Ser's  B.  Inc.  .1894,  418,000 

Plain  Income  6's 1896,  491,000 

Sterling  Mountain  Railway  Income. .  .1895,  476,000 

St.  L.,  Alton  &  T.  H.  Division  bonds.  .1894,  1,357,000 

St.  Joseph  &  G'd  Island  2d  Income.  .  .1925,  1,680,000 

Shenandoah  Valley  Income  6's 1923,  2,500,000 


PHILADELPHIA   STOCK-EXCHANGE. 

Railroad  Stocks. 

Interest, 

Atlantic  &  Pacific 100 

Bell's  Gap 50 

Buffalo,  New  York  &  Philadelphia 50 

Preferred 50 

Common,  assessment  paid 50 

Preferred,  assessment  paid 50 

Camden  &  Atlantic 50 

Preferred 50 

Catawissa 50 

1st  preferred 50 

2d  preferred 50 

Central  of  Xew  Jersey 100 

Clearfield  &  Jefferson 

Delaware  &  Bound  Brook 100 

Denver  &  Rio  Grande , . .  100 


i86  APPENDIX. 


Interest. 

East  Pennsylvania 50 

Elmira  &  Williams 50 

Preferred 50 

Harrisburg 50 

Huntingdon  &  Broad  Top  Mountain 50 

Preferred 50 

Lehigh  Valley 50 

Little  Schuylkill 50 

Minehill 50 

Nesquehoning  Valley 50 

Norfolk  &  Western 100 

Preferred 100 

Norristown 50 

Northern  Central 50 

Northern  Pacific 100 

Preferred 100 

North  Pennsylvania 50 

Oregon  &  Transcontinental 100 

Pennsylvania 50 

Philadelphia  &  Erie 50 

Philadelphia  &  Reading 50 

Preferred 50 

St.  Paul  &  Duluth 100 

Preferred 100 

Sunbury  &  Lewis 50 

Texas  &  Pacific 100 

United  Companies  of  New  Jersey 100 

West  Jersey , 50 

West  Jersey  &  Atlantic 50 

Canal  Stocks. 

Chesapeake  &  Delaware , 50 

Lehigh  Navigation .,  .o. .  .„ 50 


INVESTMENT  SECURITIES,  187 


Interest. 

Morris 100 

Preferred 100 

Schuylkill  Navigation,  preferred 50 

Common 50 

Railroad  Bonds. 

Allegheny  Valley,  regular 7  3-10 

Income 7 

Baltimore  &  Ohio,  E.  Side 5 

Belville  Delaware,  1st 6 

Consolidated 4 

Bell's  Gap,  consolidated 6 

Camden  &  Amboy,  mortgage,  coupon,  1889 6 

Coupon,  1889 6 

Catawissa,  new 7 

Camden  &  Atlantic,  1st 7 

2d  mortgage 6 

Columbus  &  Cincinnati  Midland 6 

Connecting,  1st. . .   6 

Clearfield  &  Jefferson 6 

Delaware  Railroad,  1st 6 

Delaware  &  Bound  Brook,  1st 7 

East  Pennsylvania,  1st 7 

Easton  &  Amboy 5 

Elmira  &  Western,  1st,  1910 6 

Perpetual 5 

Huntingdon  &  Broad  Top,  1st,  gold 7 

2d,  1895 7 

3d,  consolidated,  1895 5 

Ithaca  &  Athens,  1st 7 

Lehigh  Valley,  1st,  coupon 6 

1st,  regular,  1898 6 

2d,  regular,  1910 ,..,.... 7 


188  APPENDIX. 


Interest. 

Lehigh  Val.  Consolidated  mortgage,  regular,  19^3..  6 

Consolidated  mortgage,  coupon,  1923 6 

New  Orleans  Pacific,  1st,  1920 6 

New  York,  Philadelphia  &  Norfolk,  1st. 6 

Income 6 

Norfolk  &  Western,  new  railroad,  1st 6 

Debenture 6 

General  mortgage 6 

Northern  Central,  general  mort.,  "A,"  coup.,  1926..  5 

•     General  mortgage,  series  "  B  " 5 

General  mortgage,  coupon,  1904 , 6 

Northern  Pacific,  general  mortgage 6 

2d,  coupon  or  regular 6 

North  Pacific,  1st,  1896.. 7 

General  mortgage,  coupon,  1903 7 

General  mortgage,  regular,  1903 7 

Debentures . .  6 

Pennsylvania  &  New  York  C.  &  E.,  1896 7 

Eegular  and  coupon,  1906 7 

'Pennsylvania,  general,  coupon,  1910 6 

General,  regular,  1910 6 

Consolidated,  regular,  1905 6 

'    Consolidated,  coupon,  1905 6 

Consolidated,  regular,  1919 5 

Consolidated,  coupon,  1919 5 

Pennsylvania  Company,  regular,  1907 6 

Eegular,  1920., 4^ 

Coupon,  1920 4^ 

Perkiomen,  1st,  1887. 6 

Philadelphia  &  Erie,  2d,  1888 7 

General  mortgage,  1920 5 

Philadelphia  &  Eeading,  1st  series 5 

Consolidated,  2d  series 5 


INVESTMENT  SECURITIES.  189 


luterest. 

1st,  1910 6 

2d,  coupon,  1S93 7 

Improvement. 6 

Consolidated,  coupon,  1911 *? 

Consolidated,  regular,  1911 7 

Consolidated,  gold,  1911 6 

General  mortgage,  gold,  1908 6 

General  mortgage,  1908 7 

Philadelphia  &  Reading,  income,  coupon,  189G 7 

Debenture 6 

Scrip 6 

Deferred  income 6 

Convertible  adj.  scrip,  1888 6 

.   New  convertible,  1893 7 

Var.  coupons  on 

P.  &  R.  C.  &  I.,  Var.., 7 

Debenture , 7 

Philadelphia,  Wilmington  &  Baltimore,  trust  certi.  4 

Pittsburg,  Cincinnati  &  St.  Louis,  coupon 7 

Regular,  1900. 7 

Sham.  Valley  &  Pott.,  coupon 7 

Sham.  Sun.  &  Lew 5 

Shenandoah  Valley,  1st.. . ... ....... 7 

General  mortgage 6 

Steub.  &  Ind.,  1st,  coupon.. 5 

Sunb.  &  Lewist.,  1st 7 

Sun.,  Haz.  &  W.,  1928 5 

2d,  1938 6 

Texas  &  Pacific,  1st,  gold,  1805 6 

1st,  R.  G.  Division,  1930 6 

Consolidated,  gold,  1905 6 

Union  &  Titusville,  1st,  1890 7 

United  New  Jersey,  consolidated. , 6 


ipo  APPENDIX. 

Interest. 

United  New  Jersey,  General  mortgage , .  4 

Warren  &  Farnsworth,  1st,  1896 7 

West  Chester,  consolidated,  1891 7 

West  Jersey,  1st,  1896 6 

1st,  1899 7 

West  Jersey  &  Atlantic,  1st,  1910 6 

West  Pennsylvania,  1st,  1893 6 

Pittsburg  Branch,  coupon,  1896 6 

West  Shore,  guaranteed 4 

Canal  Bonds. 

Chesapeake  &  Delaware,  extend 5 

Lehigh  Navigation,  extend 4^ 

Convertible,  gold,  1894 6 

Railroad  loan,  1897 6 

Gold,  1897 6 

Consolidated  mortgage,  1911 7 

General  mortgage,  1924 4} 

Greenwood  Tract 7 

Pennsylvania,  mortgage,  1910 6 

Schuylkill  Navigation,  1st,  1897 6 

2d,  1907 6 

Boat  loan 7 

Boat  loan 6 

Susquehanna,  1918 6 


BOSTON    STOCK^EXCHANGE. 

Railroad  Stocks. 

Atlantic  &  Pacific 100 

Atchison,  Topeka  &  Santa  Fe 100 

Boston  &  Albany 100 


INVESTMENT  SECURITIES.         191 


Interest, 

Boston,  Concord  &  Montreal,  preferred 100 

Boston  &  Lowell 100 

Boston  &  Maine 100 

Boston  &  Providence 100 

California  Southern 100 

Central  Iowa 100 

2d  preferred 100 

Central  Massachusetts 100 

Preferred 100 

Cheshire,  preferred 100 

Chicago,  Burlington  &  Quincy 100 

Chicago,  Burlington  &  Northern 100 

Chicago  &  Eastern  Illinois 100 

Chicago  &  West  Michigan ...  100 

Cincinnati,  Sand.  &  Cleveland 50 

Cleveland  &  Canton 100 

Preferred.., 100 

Col.,  Spring.  &  Cincinnati 

Concord 50 

Connecticut  &  Passumpsic 100 

Connecticut  River 100 

Consolidated  of  Vermont,  preferred 100 

Detroit,  Lansing  &  Northern , 100 

Preferred 100 

Dayton  &  Ironton,  preferred 

Eastern  (Massachusetts) 100 

Preferred 100 

Eastern  in  New  Hampshire 100 

Fitchburg  preferred 100 

Flint  &  Pere  Marquette 100 

Preferred 100 

Fort  Scott  &  Gulf 100 

Preferred 100 


192  APPENDIX, 


Interest. 

Iowa  F.  &  Sioux  City 100 

Kansas  City,  Springfield  &  Memphis 100 

Kansas  City,  Memphis  &  Birmingham 

Kansas  City,  Clinton  &  Springfield 100 

Little  Rock  &  Fort  Smith 100 

Louisville  &  Missouri  Eiver 100 

Maine  Central 100 

Manchester  &  Lawrence 100 

Marquette,  Houghton  &  Ontonagon. 100 

Preferred 100 

Mexican  Central. , 100 

Nashua  &  Lowell 100 

New  York  &  New  England 100 

Preferred 100 

Northern,  New  Hampshire 100 

Norwich  &  Worcester 100, 

Ogdensburg  &  Lake  Champlain 100 

Old  Colony 100 

Philadelphia,  Wilmington  &  Baltimore 50 

Portsmouth,  Great  Falls  &  Conway 100 

Portland,  Saco  &  Portsmouth 100 

Pullman  Palace  Car. 100 

Ilevere  Beach  &  Lynn 100 

Rutland 100 

Preferred 100 

Summit  Branch 50 

Toledo,  Cincinnati  &  St.  Louis 50 

Union  Pacific, 100 

Vermont  &  Massachusetts 100 

Wisconsin  Central 100 

Preferred 1 00 

Worcester,  Nashua  &  Rochester 100 


INVESTMENT  SECURITIES.  193 


Railroad  Bonds. 

Interest. 

Atchison,  Topeka  &  Santa  Fe,  plain,  1920 5 

Trust 6 

Collateral  trust 5 

Atlantic  &  Pacific,  1st 4 

Income,  1910 6 

Central  Division,  1st 6 

Boston  &  Maine 7 

Boston  &  Albany,  not  mortgaged 7 

Burlington  &  Missouri  River,  land  grant 7 

In  Nebraska,  non-exempt,  1st 6 

In  Nebraska,  exempt,  1st 6 

In  Nebraska,  1910 4 

Cedar  Rapids  &  Missouri  River 7 

Chicago,  Burlington  &  Quincy,  Denver  Division 4 

1st,  1903 7 

Southwestern  Division 4 

Sinking  fund 5 

Plain  bonds 4 

Debentures 5 

Chicago,  Burlington  &  Northern 5 

Debenture 6 

Chicago,  Milwaukee  &  St.  Paul,  Western  Division. .  6 

Dubuque  Division 6 

Chicago  &  Eastern  Illinois,  consolidated 6 

Chicago,  Kansas  &  Western 5 

Incomes 

Chicago  &  West  Michigan 5 

Cincinnati,  Sandusky  &  Cleveland,  1st 7 

Columbus,  Springfield  &  Cincinnati 7 

Connecticut  &  Passum,  1st 7 

Consolidated  Railroad  of  Vermont 5 

17 


194  APPENDIX. 


Interest. 

California  Southern,  income 6 

1st,  1926 6 

Detroit,  Lansing  &  Northern,  1st 7 

Dixon,  Peoria  &H 8 

Eastern,  1906 6 

Fort  Scott,  S.  E.  &  M. 7 

Fort  Scott  &  Gulf,  1st 7 

Equipment 6 

Fremont  &  Elk  Horn 6 

Iowa  Falls  &  Sioux  City 7 

Illinois  Grand  Trunk 8 

Kansas  City  &  Camden 10 

Kansas  City,  Topeka  &  Western,  1st 7 

Kansas  City,  Em.  &  Southern,  Gulf 7 

Kansas  City,  Lawrence  &  Southern,  1st 6-5 

Kansas  City,  Memphis  &  Birmingham. 5 

Kansas  City,  Clinton  &  Springfield 5 

Kansas  City,  Springfield  &  Memphis 6 

Kansas  City,  St.  Joseph  &  Council  Bluffs,  1st 7 

Leavenworth,  Topeka  &  Southwestern 4 

Little  Rock  &  Fort  Smith,  land  grant,  1st 7 

Maine  Central,  1913 7 

Marion  &  McPher 7 

Marquette,  Houghton  &  Ontonagon 6 

1st  mortgage,  1923 6 

1925 6 

Mexican  Central,  1911 7 

Income 3 

Scrip 

Debenture 10 

New  assessment 4 

Bond  scrip 

New  York  &  New  England,  1st 6 


INVESTMENT  SECURITIES.  195 


Interest. 

New  York  &  New  England,  1st,  1905 7 

2d  mortgage 6 

2d  mortgage,  scaled 3-5 

New  Mexico  &  Southern  Pacific,  1st 7 

Northern  Pacific,  1st 6 

P.  d'O.  Division 6 

2d  mortgage  coupon 6 

Ogdensburg  &  Lake  Champlain,  1st 5 

Consolidated,  1920 6 

Income,  1920 3-6 

Oregon  Railway  &  Navigation  Company 7 

Consolidated,  gold 5 

Oregon  Short  Line 6 

Portsmouth,  Great  Falls  &  Camden ^ 

Pueblo  &  Arkansas  V.,  1st 7 

Republican  Valley 6 

Rutland,  2d  mortgage,  equipment 5 

1st  mortgage 6 

St.  Louis,  Kansas  City  &  Southwestern 6 

Sonora,  1st 7 

South  Kansas 5 

Incomes 

Southern  Kansas  &  Western,  1st 7 

Union  Pacific,  1st,  gold 6 

Sinking  fund,  3d  mortgage 8 

Wisconsin  Central,  2d  series 7 

1st  series 5 

Wisconsin  Valley,  1st 7 

Worcester,  Nashua  &  Rochester 5 


196  APPENDIX. 


BALTIMORE    STOCK-EXCHANGE. 

Railroad  Stocks. 

Interest. 

Atlanta  &  Charleston 100 

Baltimore  &  Ohio 100 

1st  preferred 100 

2d  preferred 100 

Canton  Co 100 

Central  Ohio 50 

Preferred 50 

Cincinnati,  Washington  &  Baltimore 100 

Preferred , 100 

Charlotte,  Columbia  &  Augusta 100 

Columbia  &  Greenville,  preferred 100 

Georgia  Pacific 

Northern  Central 50 

Parkersburg  Branch 50 

Petersburg 100 

Pittsburg  &  Connellsville 

Richmond,  York  River  &  Chesapeake 

Virginia  Midland,  1st  preferred 100 

Common 100 

Wilmington,  Columbia  &  Augusta 100 

Wilmington  &  Weldon 100 

Western  Maryland 50 

Railroad  Bonds. 

Atlanta  &  Charleston,  1st  mortgage 7 

Incomes 6 

Baltimore  &  Ohio,  East  Side,  1st 5 

Baltimore  &  Ohio,  extended 4 

Gold 5 


INVESTMENT  SECURITIES.  197 


Interest. 

Baltimore  &  Potomac,  1st 6 

Tunnel 6 

Cape  Fear  &  Yadkin  Valley,  1st 6 

Central  Ohio,  1st,  1890 6 

Charlotte,  Columbia  &  Augusta,  1st 7 

2d 7 

Cincinnati  &  Baltimore 7 

Cincinnati,  Washington  &  Baltimore,  1st 4^ 

2d 5 

3d 3 

Income 5 

Columbia  &  Greenville,  1st 6 

2d,  1926 6 

Georgia  Pacific,  1st,  1922 6 

2d,  income 6 

Northern  Central,  general 4^ 

Cur.,  1900 6 

Gold,  1900 6 

Gold,  1904 6 

Gold,  1926,  Series  A 5 

Gold,  1926,  Series  B 5 

Ohio  &  Mississippi,  Springfield  Division 7 

2d 7 

Consolidated  sinking  fund 7 

General 5 

Petersburg,  Class  A 5 

Petersburg,  Class  B , .. .  6 

Pittsburg  &  Con.,  1st,  1898 7 

Richmond  &  Danville,  gold 6 

1890.  ....c 6 

Piedmont  Branch ...  8 

Seaboard  &  Roanoke 5 

Union  Railroad,  End.  by  Chattanooga  Company. . . 


198  APPENDIX. 


Interest. 

Virgina  Midland,  1st  series 6 

2d  series 6 

3d  series 5-6 

4th  series 3-4-5 

5th  series 5 

Virginia  and  Tennessee,  4th 8 

5's 5 

West  Virginia  Central,  1st 6 

Western  Alabama,  1890 8 

West  Maryland,  3d  guaranteed  by  city 6 

Western  North  Carolina,  1st,  1890 7 

Consolidated 6 

Wilmington,  Columbia  &  Augusta,  1910 6 

Wilmington  &  Weldon,  new 5 


THE  END. 


^^r 


SCIENTIFIC  PUBLICATIONS. 


Sight: 

An  Exposition  of  the  Principles  of  Monocular  and  Binocu- 
lar Vision.  By  Joseph  Le  Conte,  LL.  D.,  author  of  "  Ele- 
ments of  Geology,"  "  Religion  and  Science,"  and  Profefsor 
of  Geology  and  Natural  History  in  the  University  of  Cali- 
fornia.   With  numerous  Illustrations.    12rao.    Cloth,  f  1.50. 

"  It  is  pleasant  to  find  an  American  book  which  can  rank  with  the 
very  best  of  foreign  works  on  this  subject.  Professor  Le  Conte  has 
long  been  knowui  as  an  original  investigator  in  this  department;  all 
that  he  gives  us  is  treated  with  a  master-hand."— TAe  J\aiion. 

Anirnal  Life, 

As  affected  by  the  Natural  Conditions  of  Existence.  By 
Karl  Semper,  Professor  of  the  University  of  Wiirzburg. 
With  Two  Maps  and  One  Hundred  and  Six  Woodcuts,  and 
Index.     12mo.     Cloth,  $2.00. 

"  It  appears  to  me  that,  of  all  the  properties  of  the  animal  organ- 
ism, Variabihty  is  that  which  may  first  and  most  easily  be  traced  by 
exact  investigation  to  its  efiicient  causes  ;  and  as  it  is  beyond  a  doubt 
the  subject  around  which,  at  the  present  moment,  the  strife  of  opin- 
ions is  most  violent,  it  is  that  which  will  be  most  lil^ely  to  repay  the 
trouble  of  closer  research.  I  have  endeavored  to  facilitate  this  task 
80  far  as  in  me  lies."— i^:rom  the  Preface. 

The  Atomic  Tfieory. 

By  Ad.  W^urtz,  Membra  de  I'lnstitut ;  Doyen  Honoraire 
de  la  Faculte  de  Medecine ;  Professeur  k  la  Faculte  des 
Sciences  de  Paris.  Translated  by  E.  Cleminshaw,  M.  A., 
F.  C.  S.,  F.  I.  C,  Assistant  Master  at  Sherborne  School. 
12mo.     Cloth,  $l.f)0. 

"There  wa?  need  for  a  book  like  this,  which  discusses  the  atomic 
theory  both  in  its  historic  evolution  and  in  its  present  form.  And 
perhaps  no  man  of  this  age  could  have  been  selected  so  able  to  per- 
form the  task  in  a  masterly  way  as  the  illustrious  French  chemist, 
Adolph  Wurtz.  It  is  impossible  to  convey  to  the  reader,  in  a  notice 
like  this,  any  adequate  idea  of  the  scope,  lucid  instructiveness,  and 
pcientific  interest  of  Professor  Wurtz's  book.  The  modern  problems 
of  chemistry,  which  are  commonly  so  obscure  from  imperfect  expo- 
sition, are  here  made  wonderfully  clear  and  attractive." — The  lopuLar 
Science  Monthly. 

Education  as  a  Science. 

By  Alexander  Bain,  LL.  D.     12ino.     Cloth,  $1.75. 
"This  work  must  be  pronounced  the  most  remarkable  discussion 
of  educational  problems  which  hns  been  published  in  our  day.     It 
should  he  in  the  hands  of  every  school-teacher  and  friend  of  education 
throughout  the  landi"— JN^ew  York  Sun. 


New  York :  D.  APPLETON  &  CO.,  1,  3,  «fc  5  Bond  Street 


SCIENTIFIC  PUBLICATIONS. 


Suicide  : 

An  Essay  in  Comparative  Moral  Statistics.  By  Henry 
MoRSELLi,  Professor  of  Psychological  Medicine  in  the 
Royal  University,  Turin.     12mo.     Cloth,  $1.75. 

"A  most  valuable  contribution  to  English  literature  tonching  a 
theme  most  distressiag  in  the  act  and  terrible  in  its  consequences, 
yet  to  this  hour  but  very  imperfectly  studied  or  understood."— PAi/a- 
ddphia  Times. 

Volcanoes: 

What  they  Are  and  what  they  Teach.  By  J.  W.  Judd, 
Professor  of  Geologv  in  the  Royal  School  of  Mines  (Lon- 
don).   With  Ninety-six  Illustrations.    12mo.    Cloth,  |2.00. 

"  In  no  field  has  modern  research  been  more  fruitful  than  in  that 
of  which  Professor  Judd  gives  a  popular  account  in  the  present  vol- 
ume. The  great  lines  of  dynamical,  geological,  and  meteorological 
inquiry  converge  upon  the  grand  problem  of  the  interior  constitution 
of  the  earth,  and  the  vast  influence  of  subterranean  agencies.  .  .  . 
His  book  is  very  far  from  being  a  mere  dry  description  of  volcanoes 
and  their  eruptions  ;  it  is  rather  a  presentation  of  the  terrestrial  facta 
and  laws  with  which  volcanic  phenomeua  are  associated." — PopiUar 
Science  Monthly. 

The  Sun: 

By  C.  A.  Young,  Ph.  D.,  LL.  D.,  Professor  of  Astronomy 
in  the  College  of  New  Jersey.  With  numerous  Illustra- 
tions. Third  edition,  revised,  with  Supplementary  Note. 
12mo.     Cloth,  $2.00. 

The  "  Supplementary  Note  "  gives  important  developments  in  solar 
astronomy  since  the  publication  of  the  second  edition  in  1882. 

"  There  is  no  rhetoric  in  his  book  ;  he  trusts  the  grandeur  of  his 
theme  to  kindle  interest  and  impress  the  feelings.  His  statements 
are  plain,  direct,  clear,  and  condensed,  though  ample  enough  for  his 
purpose,  and  the  substance  of  what  is  generally  wanted  will  be  found 
accurately  given  in  his  pages."— Popular  Science  Monthly. 

Illusions: 

A  Psychological  Study.  By  James  Sully,  author  of  "  Sen- 
sation and  Intuition,"  etc.  12mo.  Cloth,  $1.50. 
"  An  interesting  contribution  by  Mr.  James  Sully  to  the  study  of 
mental  pathology.  The  author's  field  of  inquiry  covers  all  the  phe- 
nomena of  illusion  observed  in  sense-perception,  in  the  introspection 
of  the  mind's  own  feelings,  in  the  reading  of  others'  feelings,  in  mem- 
ory, and  in  belief.  The  author's  conclusions  are  often  illustrated  by 
concrete  example  or  anecdote,  and  his  general  treatment  of  the  sub- 
ject, while  essentially  scientific,  is  sufiiciently  clear  and  animated  to 
attract  the  general  reader."— iVew  York  Sun. 


New  York:  D.  APPLETON  «fc  CO.,  1,  3,  &  5  Bond  Street. 


SCIENTIFIC  PUBLICATIONS. 


The  Brain  and  its  Functions. 

By  J.  LuTS,  Physician  to  the  Hospice  de  la  Salpetriere. 
With  Illustrations.     12mo.     Cloth,  $1.50. 

*' No  living  physiologist  is  better  entitled  to  speak  with  authority 
upon  the  structure  and  functioup  of  the  hrain  than  Dr.  Luys.  His 
ptudies  on  the  anatomy  of  the  ntsrvous  system  are  acknowledged  to 
be  the  fiillest  and  most  systematic  ever  undertaken.  Dr.  Luys  sup- 
ports his  conclusions  not  only  by  his  own  anatomical  researches,  but 
also  by  many  functional  observations  of  various  other  physiologiett', 
including  ot  course  Professor  Ferrier's  now  classical  experimente." — 
St.  James's  Gazette. 

The  Concepts  and  Theories  of  Modern  PI  testes. 

By  J.  B.  Stallo.     12mo.     Cloth,  $1.75. 

"  Judge  Stallo's  work  is  an  inquiry  into  the  validity  of  those  me- 
chanical conceptions  of  the  universe  which  are  now  held  as  funda- 
mental in  physical  science.  He  takes  up  the  leading  modern  doctrines 
which  are  based  upon  this  mechanical  conception,  such  as  the  atomic 
constitution  of  matter,  the  kinetic  theory  of  gases,  the  conservation 
of  energy,  the  nebular  hypothesis,  and  other  views,  to  find  how  much 
stands  upon  solid  empirical  ground,  and  how  much  rests  upon  meta- 
physical speculation.  Since  the  appearance  of  Dr.  Draper's  'Religion 
and  Science,'  no  hook  has  been  published  in  the  country  calculated  to 
make  so  deep  an  impression  on  thoughtful  and  educated  readers  as 
this  volume.  .  .  .  The  range  and  minuteness  of  the  author's  learning, 
the  acuteness  of  his  reasoning,  and  the  singular  precision  and  clear- 
ness of  his  style,  are  quahties  which  very  seldom  bave  been  jointly 
exhibited  in  a  scientific  treatise."— i\"(SW  York  Sun. 

The  Formation  of  Vegetable  Mould, 

Through  the  Action  of  Worms,  with  Observations  on 
their  Habits.  By  Charles  Darwin,  LL.  D.,  F.  R.  S.,  au- 
thor of  "  On  the  Origin  of  Species,"  etc.,  etc.  With  Hlus- 
trations.     12mo.     Cloth,  $1.50. 

"Mr.  Darwin's  little  volume  on  the  habits  and  instincts  of  earth- 
worms is  no  less  marked  than  the  eariier  or  more  elaborate  effoits  of 
his  genius  by  freshness  of  observation,  unfailing  power  of  interpret- 
ing and  correlating  facts,  and  logical  vigor  in  generalizing  upon  them. 
The  main  purpose  of  the  work  is  to  point  out  the  share  which  worms 
have  taken  in  the  formation  of  the  layer  of  vegetable  mould  which 
covers  the  whole  surface  of  the  land  in  every  moderately  humid  coun- 
try. All  lovers  of  nature  will  unite  in  thanking  Mr.  Darwin  for  the 
new  and  interesting  light  he  has  thrown  upon  a  subject  so  long  over- 
looked, yet  so  full  of  interest  and  instruction,  as  the  structure  and  the 
labors  of  the  earth-worm."— /Sa^«rc?a|/  Eeview. 


New  York:  D.  APPLETON  &  CO.,  1,  3,  &  5  Bond  Street. 


SCIENTIFIC  PUBLICATIONS. 


Ants,  Bees,  and  Wasps. 

A  Record  of  Observations  on  the  Habits  of  the  Social 
Hymenoptera.  By  Sir  John  Lubbock,  Bart.,  M.  P., 
F.  R.  S.,  etc.,  author  of  "  Origin  of  Civilization,  and  the 
Primitive  Condition  of  Man,"  etc.,  etc.  With  Colored 
Plates.     12mo,  cloth,  $2.00. 

"This  volume  contains  the  record  of  various  experiments  made  with 
ants,  bees,  and  wasps  during  the  last  ten  years,  with  a  view  to  test  their 
mental  condition  and  powers  of  sense.  The  principal  point  in  which  Sir 
John's  mode  of  experiment  differs  from  those  of  Huber,  Forel,  McCook, 
and  others,  is  that  he  has  carefully  watched  and  marked  particular  insects, 
and  has  had  their  nests  under  observation  for  long  periods — one  of  his 
ants'  nests  having  been  under  constant  inspection  ever  since  1874.  Hia 
observations  are  made  principally  upon  ants  because  they  show  more 
power  and  flexibility  of  mind;  and  the  value  of  his  studies  is  that  they 
belong  to  the  department  of  original  research." 

Diseases  of  Memory. 

An  Essay  in  the  Positive  Psychology.  By  Th.  Ribot, 
author  of  "  Heredity,"  etc.  Translated  from  the  French 
by  William  Huntington  Smith.     12mo,  cloth,  $1.50. 

'^M.  Eibot  reduces  diseases  of  memory  to  law,  and  his  treatise  is  of 
extraordinary  miexe^t.''''— Philadelphia  Press. 

"Not  merely  to  scientific,  but  to  all  thinking  men,  this  volume  will 
prove  intensely  interesting."— iVew  York  Observer. 

"M.  Ribot  has  bestowed  the  most  painstaking  attention  upon  his  theme, 
and  numerous  examples  of  the  conditions  considered  greatly  increase  the 
value  and  interest  of  the  volume." — Philadelphia  North  American. 

Myth  and  Science. 

By  Tito  Vignoli.     12mo,  cloth,  price,  $1.50. 

"  His  book  is  ingenious ;  ...  his  theory  of  how  science  gradually  dif- 
ferentiated from  and  conquered  myth  is  extremely  well  wrought  out,  and 
is  probably  in  essentials  correcV— Saturday  Review. 

"The  book  is  a  strong  one,  and  far  more  interesting  to  the  general 
reader  than  its  title  would  indicate.  The  learning,  the  acuteness,  the 
strong  reasoning  power,  and  the  scientific  spirit  of  the  author,  command 
admiration."— iV6t^  York  Chi-istian  Advocate. 

"An  attempt  made,  with  much  ability  and  no  small  measure  of  success, 
to  trace  the  origin  and  development  of  the  myth.  The  author  has  pursued 
his  inquiry  with  much  patience  and  ingenuity,  and  has  produced  a  very 
readable  and  luminous  ire&ti&e.'"— Philadelphia  North  American. 


New  York:  D.  APPLETON  &  CO.,  1,  3,  &  5  Bond  Street. 


THE 

POPULAR  SCIENCE  MONTHLY. 

Established   by   Edward   L.  Youmans. 


Edited  by   W.  J.  YOUMANS. 


The  Popular  Science  Monthly  was  established  a  dozen  years 
ago  to  bring  before  the  general  public  the  results  of  scientific  thought 
on  many  large  and  important  questions  which  could  find  uo  expres- 
sion in  the  current  periodicals.  Scientific  inquiry  was  penetrating 
many  new  fields,  extending  important  knowledge,  and  profoundly 
affecting  opinion  upon  numberless  questions  of  speculative  and  prac- 
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bearing  upon  the  higher  problems  of  investigation.  Leaving  the  dry 
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Science  is  the  great  agency  of  improvement  in  this  age,  private  and 
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its  advancement.  Those,  therefore,  who  desire  to  know  what  is 
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knowledge  is  rapidly  extending,  and  old  errors  are  giving  way,  will 
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Terms:  $5  00  per  annum,  or  50  cents  a  number ;  cloth  covers  for 
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New  York:  D.  APPLETON  &  CO.,  1,  3,  &  5  Bond  Street. 


THE 

NEW  YORK  MEDICAL  JOURNAL, 

A  Weekly  Review  of  Medicine. 


Begikntno  with  the  number  for  Saturday,  January  6, 1883,  the  "  New 
Tork  Medical  Journar'  became  a  weekly  instead  of  a  monthly.  The  fre- 
quent publication  of  LECTURES  is  now  made  a  prominent  feature,  and 
pains  are  taken  to  choose  such  as  will  prove  valuable  to  the  reader.  At 
the  same  time  care  is  taken  not  to  lessen  the  variety  and  value  of  the  more 
formal  articles  known  as  OEIGINAL  COMMUNICATIONS.  In  accept- 
ing articles  of  that  class,  regard  is  had  more  particularly  to  the  wants  of 
the  general  practitioner,  and  all  the  special  branches  of  medicine  are  duly 
represented. 

In  the  matter  of  BOOK  NOTICES,  publishing  more  frequently,  we  are 
able  to  avoid  delays.  Formerly  a  great  deal  of  contemporary  literature 
was  kindly  sent  to  us  in  the  reasonable  expectation  that  it  would  be  noticed 
in  our  pages— and  yet  we  were  obliged  to  pass  it  by.  Much  of  this  matter 
is  of  such  a  nature  that,  if  noticed  at  all,  it  should  be  noticed  without  delay. 
The  columns  of  the  weekly  now  enable  us  to  do  justice  to  the  literature  of 
tha  day,  and  to  keep  our  readers  fully  and  promptly  informed  of  its  scope 
and  character. 

CLINICAL  REPORTS  will  hereafter  be  a  regular  feature  of  the  weekly 
Journal,  embracing  tliuical  records  from  the  various  hospitals  and  clinics, 
not  only  of  New  York,  but  of  various  other  cities,  together  with  clinical 
contributions  from  private  practice. 

The  EDITORIAL  ARTICLES  will  be  more  numerous,  and  we  shall 
be  able  to  give  more  timely  consideration  to  passing  events.  It  is  in  this 
department  especially  that  frequency  of  issue  adds  to  the  interest  of  a 
journal. 

SOCIETY  PROCEEDINGS  will  be  given  more  promptly  than  before, 
and  those  of  a  greater  number  of  societies  will  figure. 

The  REPORTS  ON  THE  PROGRESS  OF  MEDICINE— a  feature 
of  the  Journal  which  we  have  reason  to  think  has  been  highly  valued  by 
our  readers— will  not  be  curtailed  in  their  scope.  On  the  contrary,  an  ad- 
ditional quarterly  report  will  be  published  on  Preventive  Medicine  and 
Medical  Jurisprudence.  All  the  reports  will  be  given  quarterly,  so  that 
upoa  each  of  the  departments  of  medicine  formerly  covered  by  them  (anat- 
omy and  physiology;  materia  medica,  therapeutics,  and  toxicology;  gen- 
eral medicine;  surgery;  orthopaedic  surgery  and  diseases  of  the  joints; 
obstetrics  and  gynaecology;  ophthalmology  and  otology;  cutaneous  and 
venereal  diseases ;  and  psychological  medicine),  aa  well  as  the  new  topic 
mentioned  above,  a  rei)ort  will  appear  four  times  a  year. 

Under  the  head  of  MISCELLANY  we  shall  include  matters  of  news, 
correspondence,  etc.— the  varied  items  that  one  expects  to  find  in  a  weekly 
paper. 

Terms,  $5.00  per  annum  (postage  prepaid  by  the  Publishers) ; 
single  copies,  12  cents. 


New  York:  D.  APPLETON  &  CO.,  1,  3,  &  5  Bond  Street 


1          THIS  BOOK  IS  DUE  ON  THE  T.AST  DATE      ' 
STAMPED  BELOW 

AN  INITIAL  FINE  OF  25  GENTS 

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THIS   BOOK   ON   THE  DATE   DUE.    THE   PENALTY 
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DAY    AND    TO     $1.00     ON     THE    SEVENTH     DAY 
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